By Jennifer Jacobus, PHRca, SHRM-CP SDEA Director of HR Services.
This is a reminder that your minimum wage workers are due for an increase starting January 1, 2021. As we may remember, the state has scheduled annual increases until all employers are required to pay minimum wage at the rate of $15.00/hour. Depending on the size of your company, this will happen in either 2022 or 2023. The City of San Diego, will also determine minimum wage increases, if any, and notify employers each October before the increase would be due to go into effect.
With that said, there are imminent increases effective January 1, 2021 as follows:
For employers with less than 25 employees, the minimum wage will increase from $12.00/hour to $13.00/hour. For those companies with 26 or more employees, the increase will go from $13.00/hour to $14.00/hour.
Additionally, because the minimum salary an exempt employee can be paid is directly tied to the state minimum wage (city minimum wage has no bearing on this), exempt employees that are paid the minimum will also need to be paid more, as follows, in order to retain their exempt status:
25 or less employees: $54,080
26 or more employees: $58,240
City of San Diego
Employers who have employees that work two or more hours in one or more calendar weeks of the year within the geographical boundaries of San Diego must comply with the San Diego minimum wage, regardless of the size of your company. Effective January 1, 2021, the city minimum wage will increase to $14.00/hour.
If you have any questions or need further clarification, please reach out to SDEA at 858-505-0024.