Proposed Local Minimum Wage

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E-mail the City about the proposed local minimum wage. 

 

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Frequently asked questions

 

What's New

Approved Ordinance 

The City Council made minimum wage a priority last June to help assist low wage earners with the high cost of living in Redwood City. Seventeen cities in the Bay Area have local minimum wage ordinances. The City of San Mateo and City of Belmont have adopted minimum wage ordinances. Currently, the City of San Mateo's minimum wage (for most businesses) is $13.50 an hour and will increase to $15 an hour by 2019. The City of Belmont's minimum wage will be $12.50 starting July 1, 2018 and will increase to $13.50 on January 1, 2019 and $15 on January 1, 2020. In addition to Redwood City, Brisbane and Daly City are considering establishing local minimum wage ordinances. In March, Redwood City City Council approved the first step to adopting a local minimum wage by voting to establish a local minimum wage that will reach $15 per hour by 2020. The local minimum wage will increase in two increments including an increase on January 1, 2019 to $13.50 and on January 1, 2020 to $15.00, plus the consumer price index (CPI) for 2019. The City will adjust the local minimum wage by CPI thereafter. To learn more go here.  

Background

On September 25, 2017, the City Council received a report about the County of San Mateo, the State of California and Federal minimum wages and provided feedback to City staff about establishing a local minimum wage in the City of Redwood City.

Initial City Council input included:

  • Move as quickly as possible
  • Seek business and community input on timing and the potential phasing of a local minimum wage increase
  • Do not include exceptions or exemptions in crafting the ordinance 

October 2017 through January 2018, staff conducted community and business engagement and outreach related to the proposed local minimum wage. This engagement and outreach included:

  • 6,100 Postcards mailed to all Redwood City Businesses
  • 250 Business Visits
  • 10 Stakeholder Meetings
  • 2 Business Round Table Meetings
  • 1 Community Meeting
  • Online Business Survey

Timeline and Next Steps

July 2018 - Begin business outreach about the local minimum wage implementation.

Local Minimum Wage Implementation:

 Effective Date Local  Minumum Wage
 January 1, 2019  $13.50
 January 1, 2020  $15.00 + 2019 CPI

 

Federal and State Minimum Wages

The minimum wage established by Federal, State and local government law sets the lowest wage an employer may legally pay to workers. As of January 1, 2017, California law requires the minimum wage for all industries to be no less than $10.00 per hour for businesses with less than 25 employees and $10.50 per hour for businesses with 26 or more employees. The Federal minimum wage for covered nonexempt employees has been $7.25 per hour since July 24, 2009.

On April 4, 2016, California Governor Jerry Brown signed legislation (SB 3, Leno) which will raise California’s minimum wage to $15 per hour by 2022. After January 1, 2023, future wage increases are tied to inflation, reflecting increases in the Consumer Price Index up to 3.5% per year. Under the new state law, the wage increase schedule may be temporarily suspended by the Governor during economic downturns. The increased minimum wage levels would be applied uniformly across the state. Local governments retain the ability to adopt local wage ordinances that increase the minimum wage more rapidly than the statewide time frame or increase the minimum wage level. The law also maintains existing exemptions in the state’s minimum wage law. This legislation gives California the highest minimum wage in the country along with New York.

State of California Minimum Wage

Effective Date

Employers w/ 25 Employees or Less

Employers w/ 26 Employees or More

January 1, 2016

$10.00

$10.00

January 1, 2017

$10.00

$10.50

January 1, 2018

$10.50

$11.00

January 1, 2019

$11.00

$12.00

January 1, 2020

$12.00

$13.00

January 1, 2021

$13.00

$14.00

January 1, 2022

$14.00

$15.00

January 1, 2023

$15.00

$15.00+CPI

 

Currently City of Redwood City employers are subject to Federal and State minimum wage laws. When there are conflicts in the laws, the employer must follow the strictest standard, meaning that employers must follow the standard that is most favorable to the employee. Since the State’s law on minimum wage is higher than the Federal law, covered employers are required to pay the State’s minimum wage. Similarly, should the City enact a minimum wage ordinance that is higher than State law, covered employers are required to pay the City’s minimum wage.

Local Minimum Wages

In 2012, only five local agencies (cities and counties) nation-wide had enacted a minimum wage ordinance.  As of July 2017, forty local agencies across the country have now enacted a local minimum wage ordinance.  Sixteen of the forty agencies are cities located in the Bay Area.

Currently, the City of San Mateo and City of Belmont are the only cities in San Mateo County with an adopted minimum wage ordinance. In addition to Redwood City, three other cities are now considering a minimum wage ordinance including Belmont, Brisbane and Daly City.

  • Belmont – The City Council developed a priority in February 2017 to consider increasing the minimum wage for employers in Belmont. An informational staff report went to their City Council on 8/22/17 for study session and the City Council asked for the item to come back before the Council at a future meeting.

     

  • Brisbane – Staff prepared to present on a proposed increase to the minimum wage at the 6/1/17 City Council meeting.  The item was postponed and is currently being scheduled for October.

     

  • Daly City – The City Council discussed a proposed minimum wage increase at their study session on 8/21/17.  At the meeting, the City Council asked staff to bring back a draft minimum wage ordinance for discussion before taking it out to the community for comment.

In addition, the County of San Mateo recently adopted a Living Wage Ordinance. This Ordinance currently requires contractors providing services under contract with the County of San Mateo to pay $15 per hour to their employees (as of July 1, 2017).  Government entities providing services under County contract do not need to comply with the ordinance; including cities, counties and school districts. The ordinance does not affect wages for County employees.

Demographics of Low Wage Workers in San Mateo County and Redwood City

The San Mateo County Health System conducted a high-level analysis in 2015 to create a profile of low-wage workers, defined as those who earn $15 per hour or less, in San Mateo County. They used data from the 2009-2013 Census to determine that about 25% (88,000) of San Mateo County workers earn $15 an hour or less.

Other highlights and key findings

Other Helpful Links

September 25, 2017 City Council Presentation

September 25, 2017 City Council Meeting Staff Report

September 25, 2017 City Council Discussion

Largest Jobs Concentration in Redwood City

March 26, 2018 City Council Presentation

March 26, 2018 City Council Meeting Staff Report

Local Minimum Wage Information

UC Berkeley’s Institute for Research on Labor and Employment (IRLE) Summary and Report

Bay Area Cities Local Minimum Wage List

Contact Information

localminimumwage@redwoodcity.org