Because everything is now online, many of our commercial and retail sales or services can be transactions happening in multiple states at once. So even if you are a California business, you can still be affected by new laws or court decisions in other states if you have an online presence or sales.
A worker must be making a yearly salary of at least twice the current minimum wage in order to qualify as an exempt employee. Because the minimum wage is changing, that will also affect the definition of which employees are exempt. This will be complicated and challenging for the next few years, because not only will the minimum wage change every year, but there will be a different minimum wage for smaller sized businesses (25 employees or fewer), than for larger businesses. So if you have any employees in the $40k to $50K range, you should make sure that they have not dropped below the exempt employee requirements. If your worker suddenly goes from exempt to non-exempt, you will have several new responsibilities and requirements to follow for the worker’s time and schedule.
California’s new minimum wage gradually increases the minimum wage year by year; starting at $10.50 by Jan1, 2017 and capping at $15/hour by 2022. However, smaller businesses get an extra year, so if you are a smaller business your first minimum wage increase doesn’t start until Jan 1, 2018 (same $10.50/ hour), and will not cap at $15/ hour until 2023.
After 2023, the new law also allows for some smaller yearly increases tied to inflation.
Under the new law, the California governor can also pause the minimum wage rate increase for a year, if there is an economic emergency. So be prepared to check in for regular updates on minimum wages.
Tip #1: Who’s in charge? Family run businesses still need titles and a decision-making tree. Don’t sign documents under your own name, use your business title. Even if you vote all decisions, decide who will break ties. Avoid easy legal problems by treating even a small family run business like a large corporation.