Do any work in San Jose?? New Minimum Wage AND Posting Requirements apply to you!

SPEAK YOUR MIND

Just when you thought it was safe to go back in the water…

If you or any of your employees do work in San Jose, you are required to pay the new minimum wage – even if you are not located in San Jose.

As I informed you last year, the San Jose Minimum Wage Ordinance was passed by City of San Jose voters on November 6, 2012. The Ordinance requires employers covered by the Ordinance (see below) to pay a minimum wage of $10.00 per hour beginning March 11, 2013 to each employee (whether or not they are legally authorized to work) in the United States who receives a “wage,” who performs at least two (2) hours or more per week of work in San Jose. The minimum wage is the same for adult and minor employees.

It gets worse — beginning January 1, 2014, and on every January 1 thereafter, the minimum wage will increase by an amount corresponding to the prior year’s Consumer Price Index (CPI) for urban wage earners and clerical workers for the San Francisco-Oakland-San Jose CA metropolitan statistical area as reported by the US Department of Labor, Bureau of Labor Statistics.

“Wages” include compensation that is received in the form of salary, hourly pay, piece rate, commissions and non-discretionary performance bonuses. Wages do not include tips. In addition, San Jose permits employers to offset a portion of the San Jose minimum wage for housing and meal costs. The City offsets for housing and meal costs are the same as those offsets available under the California minimum wage law. The offsets are only recognized if there is a prior voluntary agreement between the employer and employee.

An employer may not use an employee’s tips or fringe benefits (health insurance, vacation, sick leave) as a credit toward its obligation to pay the San Jose minimum wage. Commissions may be counted toward payment of the San Jose minimum wage when the commissions are earned and paid together with other compensation paid to an employee and are equal to or greater than the current San Jose minimum wage. For each pay period, employers must pay the employee an amount that equals or exceeds the hours that the employee worked multiplied by the current San Jose minimum wage. If the employee’s commissions for the pay period together with other compensation earned are less than that amount, the employer must pay the difference. Whether the employer may thereafter recover any amounts based on commissions that the employee earns in a later pay period or which are paid at a later date depends on whether the employer and employee have an enforceable written agreement.

The San Jose Minimum Wage applies to all employers that maintain a facility in San Jose or employers that are subject to the San Jose Business Tax are required to comply with the San Jose Minimum Wage Ordinance. The San Jose Minimum Wage Ordinance does not apply to employers that do not maintain a facility in the City of San Jose and are exempt from the San Jose Business Tax. Remember, if you do business in San Jose (even if you are not located there), you may be required to pay the higher rate. Even though a company does not maintain a facility in San Jose, if it (or its employees) conducts business in San Jose and is required to pay the higher wage. However, if a San Jose based company hires a worker to work outside of San Jose, if the work is performed outside of San Jose, the agency is not required to pay the San Jose minimum wage. Confused yet?? A simple rule of thumb is this: If the worker performs work in San Jose, s/he must be paid the higher wage.

In addition to payment of the minimum wage, covered employers are required to:
(1) Post a notice at the workplace of the current and prospective minimum wage rates and the employees’ rights under the Ordinance;
(2) Maintain payroll records for a period of four (4) years; and
(3) Provide the ordinance in writing to each employee at time of hire with employer’s name, address and telephone number.

I attach the Wage and Rights posters for your use (See? Lawyers are nice folks!). Other languages are available from the City in its website (see below).

Certain categories of workers including independent contractors, learners and certain disabled workers are not entitled to the California minimum wage. For further information on these categories of exempted workers, you can consult the Industrial Welfare Commission wage orders at http://www.dir.ca.gov/iwc/wageorderindustries.htm.

The San Jose Minimum Wage Ordinance is a minimum labor standard and a law of general application that applies to all employees covered by the Ordinance whether or not represented by a bargaining unit or union. However, the provisions of the Minimum Wage Ordinance may be waived by a collective bargaining agreement – but nothing else! The Ordinance requires that the waiver must be in a bona fide collective bargaining agreement and must be in clear and unambiguous terms. The parties to a collective bargaining agreement are free to negotiate any language they desire and the City of San Jose will not interfere with or participate in the negotiation of such language. There may be many different ways to accomplish an effective waiver in a collective bargaining agreement. An example of an effective waiver the City of San Jose’s Office of Equality Assurance would recognize for purposes of enforcement is as follows:

“Waiver of San Jose Minimum Wage Ordinance: To the fullest extent permitted, this agreement shall operate to waive any provisions of the San Jose Minimum Wage Ordinance and shall supersede and be considered to have fulfilled all requirements of said Ordinance as presently written, and or amended during the life of this agreement.”

Good luck with that!

Consistent with California Labor Code Section 3352(a), individuals who are the parents, spouses or children of the employers are not covered by the San Jose minimum wage. Domestic partners are also excluded under the San Jose Minimum Wage Ordinance. However, an employer must pay the required San Jose minimum wage rate to any other person who performs more than two (2) hours of work in a week and qualifies as an employee entitled to payment of the minimum wage from any employer under the California Minimum Wage law as provided under Section 1197 of the California Labor Code and wage orders published by the California Industrial Welfare Commission.

Further, information regarding the San Jose Minimum Wage Ordinance is posted at http://www.sanjoseca.gov/index.aspx?NID=3491.

This Blog post is provided as an educational service by the Law and Mediation Offices of Jil Dalesandro for clients and friends of the firm. This post is an overview only, is not a solicitation, and should not be construed as legal advice or advice to take any specific action.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

By admin | February 5, 2014 |

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