AMENDED IN SENATE MAY 25, 2023
AMENDED IN SENATE APRIL 17, 2023
AMENDED IN SENATE MARCH 28, 2023
SENATE BILL No. 525
Introduced by Senator Durazo
(Coauthors: Senators Gonzalez, Smallwood-Cuevas, Stern, and Wahab)
(Coauthors: Assembly Members Addis, Arambula, Bonta, Connolly , Haney, Jones-Sawyer, Lee, McKinnor, Ortega, and Santiago) February 14, 2023
An act to add Section 1182.14 to the Labor Code, relating to employment.
legislative counsel’s digest
SB 525, as amended, Durazo. Minimum wage: health care workers.
Existing law generally requires the minimum wage for all industries to not be less than specified amounts to be increased until it is $15 per hour commencing January 1, 2022, for emplo yers emplo ying 26 or more emplo yees and commencing January 1, 2023, for emplo yers employing 25 or fewer employees. Existing law makes a violation of minimum wage requirements a misdemeanor.
This
Commencing June 1, 2024 and until J une 1, 2025, this bill w ould require a health care w orker minimum wage of $25 $21 per hour for hours worked in covered health care employment, as defined, subject to adjustment, as prescribed. defined. Commencing J une 1, 2025, the bill would r equire a health car e minimum wa ge of $25 per hour for hours worked in covered health care employment, as defined, subject
96 to adjustment, as pr escribed. The bill w ould provide that the health care worker minimum w age constitutes the state minimum w age for covered health care employment for all purposes under the Labor Code and the Wage Orders of the Industrial Welfare Commission. The health care w orker minimum w age w ould be enforceable by the Labor Commissioner or by a covered worker through a civil action, through the same means and with the same relief available for violation of any other state minimum wage requirement. By establishing a new minimum wage, the violation of which would be a crime, the bill would impose a state-mandated local program.
This bill would require, for covered health care employment where the employee is paid on a salary basis, that the employee earn a monthly salary equivalent to no less than 2 times 150% of the health care worker minimum wage for full-time employment in order to qualify as exempt from the payment of minimum wage and overtime.
This bill would make legislative findings and declarations as to the necessity of a special statute for health care workers.
The California Constitution requires the state to reimb urse local agencies and school districts for certain costs mandated by the state.
Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
line 1 SECTION 1. Section 1182.14 is added to the Labor Code, to line 2 read:
line 3 1182.14. (a) The Legislature finds and declares as follows:
line 4 (1) Workers in the health care industry , including w orkers at line 5 general acute care hospitals, acute psychiatric hospitals, medical line 6 offices and clinics, behavioral health centers, and residential care line 7 centers provide vital health care services to California residents, line 8 including emergency care, labor and delivery, cancer treatments, line 9 and primary and specialty care. Similarly, dialysis clinics provide line 10 life-preserving care to patients with end-stage renal disease and line 11 are part of the continuum of kidney care that also includes hospitals line 12 and health systems. Residents and visitors to the state rely on access line 13 to this high-quality health care.
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line 1 (2) Higher w ages are an important means of retaining an line 2 experienced w orkforce and attracting ne w w orkers. A stable line 3 workforce benefits patients and improves quality of care. line 4 (3) Employers across multiple industries are raising wages. The line 5 health care sector in California must offer higher wages to remain line 6 competitive.
line 7 (4) Members of the health care team such as certified nursing line 8 assistants, patient aides, technicians, and food service w orkers, line 9 among many others, are essential to both routine medical care and line 10 emergency response efforts.
line 11 (5) Even before the CO VID pandemic, California w as facing line 12 an urgent and immediate shortage of health care workers, adversely line 13 impacting the health and well-being of Californians, especially line 14 economically disadv antaged Californians. The pandemic has line 15 worsened these shortages. Higher wages are needed to attract and line 16 retain health care workers to treat patients, including being prepared line 17 to provide necessary care in an emergency.
line 18 (b) As used in this section:
line 19 (1) (A) “Covered health care emplo yment” means an y of the line 20 following:
line 21 (i) All paid w ork performed on the premises of an y covered line 22 health care facility, regardless of the identity of the employer. line 23 (ii) All paid work providing health care services performed for line 24 any person that owns, controls, or operates a covered health care line 25 facility, regardless of work location.
line 26 (B) Notwithstanding subparagraph (A), “co vered health care line 27 employment” does not include:
line 28 (i) Employment as an outside salesperson.
line 29 (ii) Any work performed in the public sector where the primary line 30 duties performed are not health care services.
line 31 (iii) Delivery work on the premises of a co vered health care line 32 facility, provided that the deli very worker is not an emplo yee of line 33 any person that owns, controls, or operates a covered health care line 34 facility.
line 35 (2) “Covered health care facility” means any of the following:
line 36 (A) A facility or other w ork site that is part of an inte grated line 37 health care delivery system.
line 38 (B) A licensed general acute care hospital, as defined in line 39 subdivision (a) of Section 1250 of the Health and Safety Code. 96 SB 525 — 3 —
line 1 (C) A licensed acute psychiatric hospital, as defined in line 2 subdivision (b) of Section 1250 of the Health and Safety Code. line 3 (D) A special hospital, as defined in subdivision (f) of Section line 4 1250 of the Health and Safety Code.
line 5 (E) A licensed skilled nursing facility, as defined in subdivision line 6 (c) of Section 1250 of the Health and Safety Code. line 7 (F) A public health jurisdiction described in Section 101185 of line 8 the Health and Safety Code.
line 9 (G) A patient’s home when health care services are deli vered line 10 by an entity owned or operated by a general acute care hospital or line 11 acute psychiatric hospital.
line 12 (H) A licensed home health agenc y, as defined in subdi vision line 13 (a) of Section 1727 of the Health and Safety Code. line 14 (I) A clinic, as defined in Section 1204 of the Health and Safety line 15 Code, including a primary care clinic, specialty care clinic, or a line 16 dialysis clinic.
line 17 (J) A psychology clinic, as defined in Section 1204.1 of the line 18 Health and Safety Code.
line 19 (K) A clinic as defined in subdi vision (d), (g), (h) or ( l) of line 20 Section 1206 of the Health and Safety Code.
line 21 (L) A licensed residential care facility for the elderly, as defined line 22 in Section 1569.2 of the Health and Safety Code, if affiliated with line 23 an acute care pro vider or o wned, operated or controlled by a line 24 general acute care hospital, acute psychiatric hospital, or the parent line 25 entity of a general acute care hospital or acute psychiatric hospital. line 26 (M) A psychiatric health facility, as defined in Section 1250.2 line 27 of the Health and Safety Code.
line 28 (N) A mental health rehabilitation center, as defined in Section line 29 5675 of the Welfare and Institutions Code.
line 30 (O) A community clinic licensed under subdi vision (a) of line 31 Section 1204 of the Health and Safety Code, an intermittent clinic line 32 exempt from licensure under subdi vision (h) of Section 1206 of line 33 the Health and Safety Code, a clinic operated by the state or an y line 34 of its political subdi visions, including, b ut not limited to, the line 35 University of California or a city or county that is e xempt from line 36 licensure under subdivision (b) of Section 1206 of the Health and line 37 Safety Code, a tribal clinic e xempt from licensure under line 38 subdivision (c) of Section 1206 of the Health and Safety Code, or line 39 an outpatient setting conducted, maintained, or operated by a line 40 federally recognized Indian tribe, tribal or ganization, or urban 96 — 4 — SB 525
line 1 Indian organization, as defined in Section 1603 of Title 25 of the line 2 United States Code.
line 3 (P) A rural health clinic, as defined in paragraph (1) of line 4 subdivision (l) of Section 1396d of Title 42 of the United States line 5 Code.
line 6 (Q) An urgent care clinic.
line 7 (R) An ambulatory surgical center that is certified to participate line 8 in the Medicare program under Title XVIII (42 U.S.C. Sec. 1395 line 9 et seq.) of the federal Social Security Act.
line 10 (S) A physician group.
line 11 (T) A county correctional f acility that pro vides health care line 12 services.
line 13 (U) A county mental health facility.
line 14 (3) “Employ” means to engage, suffer suffer, or permit to work. line 15 (4) “Employee” means any person employed by an employer. line 16 (5) “Employer” means a person who directly or indirectly , or line 17 through an agent or any other person, employs or exercises control line 18 over the w ages, hours, or w orking conditions of an y person. line 19 “Employer” includes the state, political subdivisions of the state, line 20 the University of California, and municipalities. line 21 (6) “Health care services” means patient care-related services line 22 including nursing; care giving; services pro vided by medical line 23 residents, interns, or fello ws; technical and ancillary services; line 24 janitorial w ork; housek eeping; groundsk eeping; guard duties; line 25 business office clerical w ork; food services; laundry; medical line 26 coding and billing; call center and w arehouse work; scheduling; line 27 and gift shop w ork; b ut only where such services directly or line 28 indirectly support patient care.
line 29 (7) “Health care worker minimum wage” means the minimum line 30 wage rate established by this section.
line 31 (8) “Integrated health care delivery system” means an entity or line 32 group of related entities that includes both of the follo wing: (A) line 33 one or more hospitals and (B) one or more physician groups, health line 34 care service plans, medical foundation clinics, other health care line 35 facilities, or other entities, providing health care or supporting the line 36 provision of health care, where the hospital or hospitals and other line 37 entities are related through one of the following:
line 38 (i) Parent and subsidiary relationships, joint or common line 39 ownership or control, common branding, or common boards of line 40 directors and shared senior management.
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line 1 (ii) A contractual relationship in which affiliated co vered line 2 physician groups or medical foundation clinics contract with a line 3 health care service plan, hospital or other part of the system, all line 4 operating under a common trade name.
line 5 (iii) A contractual relationship in which a nonprofit health care line 6 service plan pro vides medical services to enrollees in a specific line 7 geographic region of the state through an affiliated hospital system, line 8 and contracts with a single co vered ph ysician group in each line 9 geographic region of the state to pro vide medical services to a line 10 majority of the plan’s enrollees in that region. line 11 (9) “Physician group” means a medical group practice, including line 12 a professional medical corporation, as defined in Section 2406 of line 13 the Business and Professions Code, another form of corporation line 14 controlled by physicians and surgeons, a medical partnership, or line 15 an independent practice association, pro vided that the group line 16 includes a total of 25 or more physicians.
line 17 (10) “Urgent care clinic” means a facility or clinic that provides line 18 immediate, nonemer gent amb ulatory medical care to patients, line 19 including, but not limited to, f acilities known as w alk-in clinics line 20 or centers or urgent care centers.
line 21 (c) (1) Notwithstanding any other provision of this chapter, on line 22 and after January J une 1, 2024, and until J une 1, 2025, the line 23 minimum wage for covered health care employment shall be not line 24 less than twenty-five twenty-one dollars ($25) ($21) per hour for line 25 all hours worked in covered health care employment. Any portion line 26 of an y w orker’s time spent w orking in co vered health care line 27 employment shall be compensated at the minimum w age of not line 28 less than twenty-five twenty-one dollars ($25) an ($21) per hour. line 29 (2) Notwithstanding any other provision of this chapter, on and line 30 after June 1, 2025, the minimum wa ge for co vered health car e line 31 employment shall be not less than twenty-five dollar s ($25) per line 32 hour for all hours worked in covered health care employment. Any line 33 portion of any worker’s time spent working in covered health care line 34 employment shall be compensated at the minimum wa ge of not line 35 less than twenty-five dollars ($25) per hour.
line 36 (d) (1) Following the implementation of the minimum w age line 37 increase specified in paragraph (2) of subdivision (c), on or before line 38 August 1 of that year, and on or before each August 1 thereafter, line 39 the Director of Finance shall calculate an adjusted minimum wage. line 40 The calculation shall increase the minimum w age by the greater 96 — 6 — SB 525
line 1 lesser of 3.5 percent or the rate of change in the a verages of the line 2 most recent July 1 to June 30, inclusive, period over the preceding line 3 July 1 to June 30, inclusi ve, period for the United States Bureau line 4 of Labor Statistics nonseasonally adjusted United States Consumer line 5 Price Index for Urban Wage Earners and Clerical Workers (U.S. line 6 CPI-W). The result shall be rounded to the nearest ten cents line 7 ($0.10). Each adjusted minimum wage increase calculated under line 8 this subdivision shall take effect on the following January 1. line 9 (2) If the rate of change in the averages of the most recent July line 10 1 to June 30, inclusi ve, period over the preceding July 1 to June line 11 30, inclusi ve, period for the United States Bureau of Labor line 12 Statistics nonseasonally adjusted U.S. CPI-W is ne gative, there line 13 shall be no increase or decrease in the minimum wage pursuant to line 14 this subdivision on the following January 1.
line 15 (e) The health care worker minimum wage shall constitute the line 16 state minimum wage for covered health care employment for all line 17 purposes under this code and the Wage Orders of the Industrial line 18 Welfare Commission. It shall be enforceable by the Labor line 19 Commissioner or by a co vered w orker through a ci vil action, line 20 through the same means and with the same relief a vailable for line 21 violation of any other state minimum wage requirement. line 22 (f) For covered health care employment where the compensation line 23 of the emplo yee is on a salary basis, the emplo yee shall earn a line 24 monthly salary equivalent to no less than two times 150 percent line 25 of the health care worker minimum wage for full-time employment line 26 in order to qualify as exempt from the payment of minimum wage line 27 and o vertime under the la w of this state, including where the line 28 employer is the state, a political subdi vision of the state, the line 29 University of California, or a municipality.
line 30 SEC. 2. The pro visions of this act are se verable. If an y line 31 provision of this act or its application is held invalid, that invalidity line 32 shall not affect other provisions or applications that can be given line 33 effect without the invalid provision or application. line 34 SEC. 3. The Legislature finds and declares that a special statute line 35 is necessary and that a general statute cannot be made applicable line 36 within the meaning of Section 16 of Article IV of the California line 37 Constitution because of the ur gent and immediate shortage of line 38 health care workers.
line 39 SEC. 4. No reimbursement is required by this act pursuant to line 40 Section 6 of Article XIIIB of the California Constitution because 96 SB 525 — 7 —
line 1 the only costs that may be incurred by a local agenc y or school line 2 district will be incurred because this act creates a ne w crime or line 3 infraction, eliminates a crime or infraction, or changes the penalty line 4 for a crime or infraction, within the meaning of Section 17556 of line 5 the Government Code, or changes the definition of a crime within line 6 the meaning of Section 6 of Article XIII B of the California line 7 Constitution.
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