Wage Orders Update!

  • May 19 2017

It’s already been a busy year for employers with lots of action from the California Legislature, federal and state agencies, local governments, and our courts.  Wage and hour employment law has received a lot of attention from policy makers, enforcement agencies and the courts.

California’s Department of Industrial Relations (DIR) regulates wages and hours of employees with documents called Wage Orders.  There are 17 Wage Orders, each one specific to the industry or occupation it covers.  California employers must comply with the Wage Order that is applicable to its industry or occupation.  It is important to understand which Wage Order covers your business to comply with the correct laws, and more than one wage order may apply in some cases.

In general, the main or primary purpose of your business will determine which Wage Order applies. First, determine whether one of the industry orders covers your business. Industry orders include all but Wage Orders 4, 14, 15 and 17, which are occupation orders.

If no industry order applies to your business, then you must consider each employee’s occupation to determine which occupation order applies (Occupation Orders are 4, 14 and 15). The most common occupation order is Wage Order 4, which covers “Professional, Technical, Clerical, Mechanical and Similar Occupations.”

The DIR publishes a guide called, “Which IWC Order?” (available on the DIR website) that is helpful in determining which Wage Order applies to your business.

Governor Brown signed SB 3, a bill that will increase minimum wage in California to $15 per hour by January 1, 2022 for employers with 26 or more employees and by January 1, 2023 for employers with fewer than 26 employees.  The DIR recently updated most Wage Orders to reflect the 2017 and 2018 increases in the state minimum wage.

For employers with more than 25 employees, the minimum wage increases as follows:

$10.50 per hour on January 1, 2017.

$11 per hour on January 1, 2018.

For employers with 25 or fewer employees, the minimum wage increases as follows:

$10 per hour on January 1, 2017.

$10.50 per hour on January 1, 2018.

One significant requirement in the Wage Orders that has been the subject of recent litigation deals with seating requirements.  Employers are now required to perform a case-by-case analysis of tasks performed at various work locations, such as check out aisles, to determine if a seat is required.  The burden is of the employer to show that compliance with the Wage Order seating requirement is not feasible.

In addition, employers are required to post a copy of the proper Wage Order in the workplace where employees can read it easily.  All California employers must post at least 1 of the 17 industry-specific Wage Orders; and California’s Minimum Wage order (MW-2017).

If you need assistance determining which Wage Order applies to your business, or with applying or interpreting Wage Order requirements, contact an employment law attorney at Schneiders & Associates.

Posted in: Employment Law


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