IR # 96-34
Friday, August 23, 1996

Rick Rice
Troy Swauger
(415) 972-8835

Industrial Welfare Commission Adopts New Minimum Wage

SAN FRANCISCO --The California Industrial Welfare Commission (IWC) at its meeting today in San Francisco formally adopted the newly enacted federal minimum wage of $4.75 per hour. The increase takes effect on October 1, 1996.

The Commission, which sets standards for wages, hours and working conditions in California, voted unanimously in favor of the measure. California Labor Code Section 1182(b) specifies that if the federal minimum wage increases to a level higher than that of the state, then the Commission is required to adopt the federal minimum wage.

The newly enacted federal law adopted by the IWC also contains an exemption to the $4.75 per hour minimum wage known as the "opportunity wage." The opportunity wage is applicable only to employees under 20 years of age and provides that they may be paid a minimum of $4.25 per hour during their first 90 consecutive days of employment with each employer.

The actions taken by the IWC to bring California's minimum wage into conformity with the federal minimum wage affects no other provisions of current IWC Orders. Meal and lodging credits will remain the same as currently contained in the IWC Order MW-88 and the other IWC Orders.

The federal law also contains a provision that will again increase the minimum wage to $5.15 effective on September 1, 1997.

In the next few weeks all California employers will be sent an alert to the changes in the law in a mass mailing provided by the Employment Development Department. Following that, the Industrial Welfare Commission is preparing an "Official Notice"* of the new minimum wage which will be mailed to all employers within the next few months. Employers will then be required to post the Official Notice in the workplace next to their IWC industry or occupational order.


*Note: The Industrial Welfare Commission Minimum Wage Order is in Adobe Acrobat .pdf format, 63K