California Health Care Worker Minimum Wage Takes Effect Oct. 16

The California Department of Industrial Relations has announced that the minimum wage for covered health care workers will go into effect Oct. 16, 2024. Originally, the minimum wage was supposed to take effect June 1, 2024, but it was delayed twice.

The Details

Implementation of the minimum wage increase for health care workers was contingent on certain triggers. One of those triggers occurred on Oct. 1, 2024. This means the health care minimum wage increases will take effect 15 days later, on Oct. 16, 2024.

Beginning on Oct. 16, 2024, health care workers are eligible to receive the higher minimum wage if they: (1) work for certain “health care facilities” that are covered in the law and (2) provide health care services or support the provision of health care. The minimum wage for covered health care workers will be $18, $21, or $23, depending on the type of health care facility. 

Covered Health Care Facilities

Beginning Oct. 16, 2024, the new minimum wage for health care workers will apply to nearly all health care facilities operating in the state, including:

•  Hospitals and Hospital Systems:
  
  
• Care in Residential Settings:
  
  
• A physician’s group. A physician’s group is a medical practice or medical partnership that has 25 or more physicians.
  
  
• A county mental health facility.
  
  
• A county correctional facility (e.g., jail) that provides health care services.
  
  
• Mental Health Rehabilitation Centers. A list of all Licensed Mental Health Rehabilitation Centers is available here.
  
  
• Outpatient clinics. The following outpatient facilities that provide health care services to patients that remain less than 24 hours are covered:
  

The California Department of Public Health’s Cal Health Find Database available here can also assist in identifying health care facility types. On that webpage, search by the “facility name” or location to find the facility. The search results will identify the facility type.

Covered Health Care Employees

Covered health care employees are employees of a covered health care facility employer who provide patient care, health care services, or services that support the provision of health care.

These workers include but are not limited to the following (regardless of formal job title): 

Employees of subcontractors or contractors are covered by the new health care minimum wage if:

• The worker provides health care services or services supporting the provisions of health care, and;
• The worker’s employer (the contractor or subcontractor) contracts with a “covered health care facility” directly or through a contractor or subcontractor to provide health care services or services supporting the provision of health care; and
• The health care facility operates as a joint employer of the worker (engages, suffers, or permits the employee to work or exercises control of the employees’ wages hours, or working conditions) OR the worker spends more than 50% of their time in a workweek performing work at the covered health care facility.

New Minimum Wage for Health Care Workers

Beginning Oct. 16, 2024, the minimum wage for covered health care workers depends on the type of health care facility in question. The law also includes a schedule for these minimum wages to increase in the future.

Minimum Salary Requirement for State Exemption from Overtime

To qualify as exempt from the minimum wage and overtime under state law, the minimum salary for a covered health care employee paid on a salary basis is the greater of 150% of the applicable health care worker minimum wage or 200% of the state standard minimum wage, for fulltime employment.

Here’s how this will play out when the health care minimum wage goes into effect on Oct. 16, 2024.

The minimum salary requirements for state exemption from overtime will change on Jan. 1, 2025.

Note: Employees must also satisfy applicable duties tests. Additionally, local minimum wages aren’t considered for the purposes of minimum salary for the state overtime exemption test, even if they are higher than the state's standard minimum wage.

Wage Orders and Employer Notice

The law requires the Department of Industrial Relations to revise the Industrial Welfare Commission’s wage orders to be consistent with the new health care minimum wage. The Labor Commissioner’s Office posted a Health Care Minimum Wage Supplement to the minimum wage order.

All covered employers must:

• Post a copy of the revised order supplement in a conspicuous location frequented by employees during the hours of the workday.
• Provide to each employee on the effective date of the earliest minimum wage increase a written notice, in the language the employer normally uses to communicate employment-related information to the employee, indicating the minimum wage provision that applies to the employer and the health care worker minimum wage schedule applicable to the employee.

Next Steps

Health care facility employers in California should:

• Review the law with legal counsel to determine what category their organization falls under.
• Read the state’s FAQs on the law.
• Post an updated wage order and provide employees with the required written notice.
• Pay employees as required.