Oakland’s new $12.25 Minimum Wage and Paid Sick Leave Laws Go Into Effect on March 2

Oakland’s minimum wage will increase from the state’s $9 an hour to their own voter approved level of $12.25, starting  March 2, 2015, and then rise with the Regional Consumer Price Index beginning on January 1, 2016, and every year thereafter.   The new law also requires that employers in Oakland provide paid sick leave to their employees beginning on March 2, 2015, and includes a provision that hospitality employers who collect service charges from customers pay all service charges to their hospitality workers. To read the Oakland City Attorney’s Frequently Asked Questions on these new laws, visit here.  To download the new notices related to the minimum wage, paid sick leave law and service charges, click here for English, Spanish and Cantonese.

The Paid Sick leave provisions require that any employee who performs at least two (2) hours of work in a given week within the geographic boundaries of Oakland is entitled to accrue paid sick leave for every thirty hours (30) hours they work, including overtime.  Employees are not be entitled to use any accrued paid sick leave until after ninety (90) calendar days of employment.  Small businesses (less than 10 employees) may cap paid sick leave earned by an employee at forty hours (40) hours, while a cap can be set at seventy-two (72) hours for employees of all other employers. If an employee uses paid sick leave and falls below the cap, even during the same year, he/she starts accruing paid leave again. An employer may also set a higher cap for paid sick leave or no cap at all; accrued hours carryover to the next year. Please note that Oakland’s new sick leave law will be affected by the state’s new law, which will go into effect July 1, 2015.

Finally, the law defines a “service charge” as a separately designated amount collected by a Hospitality Employer from customers for services rendered by Hospitality Workers. These charges include, items on receipts labeled as “service charge,” “delivery charge” or “porterage charge.” The City Attorney’s FAQs outline the following examples of service charges that must be paid to Hospitality Workers: service charges collected for banquets or catered meetings must be paid to the employees who actually worked the banquet or catered meetings; service charges collected for room service shall be paid to employees who actually deliver food and beverage associated with the charge; and service charges collected for porterage service shall be paid to the employee who actually carries the bag associated with the charge.  Service charges cannot count toward minimum wage and must be paid the payroll following receipt.

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