Gov. Gavin Newsom (D-CA) signed a bill Friday that would raise healthcare workers’ minimum wage to $25 after June 1, 2026.
The law would apply to clinics with more than 10,000 full-time equivalent employees, county-run facilities with populations over 5 million, and all dialysis clinics. Previously, California law had the minimum wage at $15 for facilities with more than 26 employees and gave smaller facilities until this year to comply. California has more than 1.1 million employees in the industry currently, with this bill applying to some 40% of them.
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This will also affect the salaries of full-time healthcare workers as it raises their “monthly salary equivalent to no less than 150% of the health care worker minimum wage or 200% of the applicable minimum wage, whichever is greater.” Violation of this law would result in a misdemeanor.
“Thank you, Governor Newsom, for signing SB 525, a historic investment in our healthcare workforce,” California Sen. María Elena Durazo wrote on X, formerly known as Twitter. Durazo introduced the bill in February.
Thank you, Governor Newsom, for signing SB 525, a historic investment in our healthcare workforce. SB 525 establishes a schedule for healthcare facilities that will bring healthcare workers up to a minimum wage of $25 per hour! @seiucalifornia, @seiu_uhw
— Senator María Elena Durazo (@SenMariaEDurazo) October 14, 2023
Newsom’s approval of the bill is expected to save the state money in its safety net programs, including Medi-Cal, CalFresh, CalWORKS, and the Federal Earned Income Tax Credit. UC Berkley’s Labor Center estimated that the result will be $467 million in net savings according to the 2023 budget.
The California governor has been engaging in a pattern of money-saving bill signings and vetoes in the last few days. For example, he vetoed S.B. 541, which would have provided free condoms for high school students across the state, citing the current budget.
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“With our state facing continuing economic risk and revenue uncertainty, it is important to remain disciplined when considering bills with significant fiscal implications, such as this measure,” Newsom wrote in his decision.
This wage increase is set on an incremental schedule, with the first raise to $23 coming June 2024, then $24 in June 2025.
