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File Number: 16-330 <br />$15/hour July 1, 2020 <br />It should also be noted that should the statewide minimum wage for businesses of any size <br />eventually meet or exceed the above thresholds, the local wage requirements outlined in the <br />proposed ordinance will automatically sunset. Per the recently enacted statewide minimum <br />wage law, all employers in California (regardless of size) are expected to fully achieve a $15 <br />per hour wage by January 1, 2023, unless the Governor delays the implementation schedule <br />by initiating the “off-ramp” provisions in the adopted legislation. <br />Enforcement & Penalties for Violation <br />City staff recommends that enforcement of the ordinance be handled on a complaint-driven <br />basis. The City has never before regulated wages on such a comprehensive and universal <br />manner, so it is currently unknown what level of staff support or other General Fund costs will <br />be required to ensure compliance. For comparison purposes, the City of Berkeley has a <br />full-time staff person who handles enforcement of its local minimum wage ordinance. The City <br />of Emeryville contracts with a part time staff person to provide similar enforcement work for its <br />own minimum wage law. As such, staff recommends conducting further analysis over the <br />year ahead and building into the FY 2017-18 budget sufficient resources to handle the <br />anticipated implementation and monitoring costs. <br />Should a local business be found out of compliance with the ordinance, the business would <br />be required to pay back wages unlawfully withheld or underpaid, and the payment of a civil <br />penalty of $25.00 to each employee or person whose rights under this Chapter were violated <br />for each day or portion thereof that the violation occurred or continued, along with fines <br />imposed pursuant to other provisions outlined in the attached draft ordinance or as allowed by <br />state law. <br />Anticipated Impact on City Workforce & Budget <br />As of the date of this staff report, there are a number of part-time, non-permanent employees <br />in the City’s Recreation & Human Services Department and Library Department who make <br />less than the proposed minimum wage. Additionally, it is important to note that increasing the <br />wage of these classifications will cause compaction to other classifications, thereby requiring <br />an increase in the hourly rate of pay for Recreation Leader, Recreation Specialist, and Office <br />Assistant positions. Under current staffing levels, there are approximately 130 employees in <br />these classifications who would be impacted either directly or through compaction (with the <br />majority of the impact resulting from compaction). The precise nature of wage increases <br />resulting from compaction have not been determined at this time, so the projected fiscal <br />impacts are subject to change. <br />Preliminarily, staff estimates the cumulative impact of these changes will result in the following <br />increased costs to the General Fund, broken out by fiscal year. These estimated costs were <br />calculated with a presumption that the new statewide minimum wage requirements will be <br />implemented according to the schedule codified by state law. Therefore, the costs shown <br />below are over-and-above the costs the City will incur as a result of the State minimum wage. <br />Should the Governor ultimately effectuate any of the off-ramp provisions allowed by that law <br />(thereby delaying the implementation timeframe of the statewide minimum wage), the relative <br />costs to the City of implementing a local ordinance would commensurately increase during the <br />initial years of implementation. <br />Page 2 City of San Leandro Printed on 6/28/2016