BILL NUMBER: SB 3	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MARCH 28, 2016
	AMENDED IN SENATE  MARCH 11, 2015

INTRODUCED BY   Senators Leno  , De León,  and Leyva
    (   Principal coauthor: 
 Senator  De León   )

    (   Principal   coauthors:  
Assembly Members   Bonta,   Gomez,  
Gonzalez,   Roger Hernández,   McCarty,  
Rendon,   and Ting   ) 
   (Coauthors: Senators  Hancock   
 and McGuire   Beall,   Block, 
 Hall,   Hancock,  Hertzberg,   Hill,
  Hueso,   Jackson,   Lara,  
Liu,   McGuire,   Mendoza,   Mitchell,
  Monning,   Pan,   Wieckowski,  
and Wolk  )
   (  Coauthor:   Assembly Member 
 Mark Stone   Coauthors:   Assembly
Members   Atkins   and Mark Stone  )

                        DECEMBER 1, 2014

    An act to amend Section 1182.12 of the Labor Code,
relating to wages.   An act to amend Sections 245.5,
246, and 1182.12 of the Labor Code, relating to labor. 


	LEGISLATIVE COUNSEL'S DIGEST


   SB 3, as amended, Leno.  Minimum wage: adjustment.
  Minimum wage: in-home supportive services: paid sick
days.  
   (1) Under existing law, the Healthy Workplaces, Healthy Families
Act of 2014, an employee who, on or after July 1, 2015, works in
California for the same employer for 30 or more days within a year
from the commencement of employment is entitled to paid sick days, as
specified. Existing law requires an employee to accrue paid sick
days at the rate of not less than one hour per every 30 hours worked
subject to specified use and accrual limitations. For the purposes of
the act, an "employee" does not include a provider of in-home
supportive services, as described.  
   This bill, on and after July 1, 2018, would entitle a provider of
in-home supportive services who works in California for 30 or more
days within a year from the commencement of employment to paid sick
days, subject to specified full amount of leave time amounts and that
rate of accrual. The bill would require the State Department of
Social Services, in consultation with stakeholders, to convene a
workgroup to implement paid sick leave for in-home supportive
services providers and to issue guidance in that regard by December
1, 2017. The bill would authorize the department to implement that
paid sick leave without complying with the Administrative Procedure
Act.  
   (2) On and after July 1, 2014, existing law requires the minimum
wage for all industries to be not less than $9 per hour. On and after
January 1, 2016, existing law requires the minimum wage for all
industries to be not less than $10 per hour.  
   This bill would require the minimum wage for all industries to not
be less than specified amounts to be increased from January 1, 2017
to January 1, 2022, inclusive, for employers employing 26 or more
employees and from January 1, 2018 to January 1, 2023, inclusive, for
employers employing 25 or fewer employees, except when the scheduled
increases are temporarily suspended by the Governor, based on
certain determinations. This bill would also require the Director of
Finance, after the last scheduled minimum wage increase, to annually
adjust the minimum wage under a specified formula.  
   On or before July 28, 2017, and on or before every July 28
thereafter until the minimum wage is a specified amount for employers
employing 26 or more employees, the bill would require the Director
of Finance to annually determine, based on certain factors, whether
economic conditions can support a scheduled minimum wage increase and
certify that determination to the Governor and the Legislature. The
bill would also require the State Board of Equalization to publish
specified retail sales and use tax information on its Internet Web
site to be used by the Director of Finance in making that
determination.  
   On or before July 28, 2017, and on or before every July 28
thereafter until the minimum wage is a specified amount for employers
employing 26 or more employees, in order to ensure that the state
General Fund can support the next scheduled minimum wage increase,
the bill would also require the Director of Finance to annually
determine and certify to the Governor and the Legislature whether the
state General Fund would be in a deficit in the current fiscal year,
or in either of the following 2 fiscal years.  
   Existing law provides that it is the continuing duty of the
Industrial Welfare Commission to ascertain the wages paid to all
employees in this state, to ascertain the hours and conditions of
labor and employment in the various occupations, trades, and
industries in which employees are employed in this state, and to
investigate the health, safety, and welfare of those employees.
Existing law establishes the Division of Labor Standards Enforcement
in the Department of Industrial Relations for the enforcement of
labor laws, including minimum wage fixed by statute and the wage
orders of the Industrial Welfare Commission. Existing law requires
that, on and after July 1, 2014, the minimum wage for all industries
be not less than $9 per hour. Existing law further increases the
minimum wage, on and after January 1, 2016, to not less than $10 per
hour.  
   This bill would increase the minimum wage, on and after January 1,
2016, to not less than $11 per hour, and on and after July 1, 2017,
to not less than $13 per hour. The bill would require, commencing
January 1, 2019, the annual automatic adjustment of the minimum wage
to maintain employee purchasing power diminished by the rate of
inflation during the previous year. The adjustment would be
calculated using the California Consumer Price Index, as specified.
The bill would prohibit the commission from reducing the minimum wage
and from adjusting the minimum wage if the average percentage of
inflation for the previous year was negative. The bill would require
the Division of Labor Standards Enforcement to publicize the
automatically adjusted minimum wage.  
   The bill would provide that its provisions not be construed to
preclude an increase in the minimum wage by the commission to an
amount greater than the formula would provide, to result in a
reduction in the minimum wage, or to preclude or supersede an
increase of the minimum wage by any local government or tribal
government that is greater than the state minimum wage. 

   The bill would apply to all industries, including public and
private employment. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 245.5 of the   Labor
Code   is amended to read: 
   245.5.  As used in this article:
   (a) "Employee" does not include the following:
   (1) An employee covered by a valid collective bargaining agreement
if the agreement expressly provides for the wages, hours of work,
and working conditions of employees, and expressly provides for paid
sick days or a paid leave or paid time off policy that permits the
use of sick days for those employees, final and binding arbitration
of disputes concerning the application of its paid sick days
provisions, premium wage rates for all overtime hours worked, and
regular hourly rate of pay of not less than 30 percent more than the
state minimum wage rate.
   (2) An employee in the construction industry covered by a valid
collective bargaining agreement if the agreement expressly provides
for the wages, hours of work, and working conditions of employees,
premium wage rates for all overtime hours worked, and regular hourly
pay of not less than 30 percent more than the state minimum wage
rate, and the agreement either (A) was entered into before January 1,
2015, or (B) expressly waives the requirements of this article in
clear and unambiguous terms. For purposes of this subparagraph,
"employee in the construction industry" means an employee performing
work associated with construction, including work involving
alteration, demolition, building, excavation, renovation, remodeling,
maintenance, improvement, repair work, and any other work as
described by Chapter 9 (commencing with Section 7000) of Division 3
of the Business and Professions Code, and other similar or related
occupations or trades. 
   (3) A provider of in-home supportive services under Section
14132.95, 14132.952, or 14132.956 of, or Article 7 (commencing with
Section 12300) of Chapter 3 of Part 3 of Division 9 of, the Welfare
and Institutions Code.  
   (4) 
    (3)  An individual employed by an air carrier as a
flight deck or cabin crew member that is subject to the provisions of
Title II of the federal Railway Labor Act (45 U.S.C. Sec. 151 et
seq.), provided that the individual is provided with compensated time
off equal to or exceeding the amount established in paragraph (1) of
subdivision (b) of Section 246. 
   (5) 
    (4)  An employee of the state, city, county, city and
county, district, or any other public entity who is a recipient of a
retirement allowance and employed without reinstatement into his or
her respective retirement system pursuant to either Article 8
(commencing with Section 21220) of Chapter 12 of Part 3 of Division 5
of Title 2 of the Government Code, or Article 8 (commencing with
Section 31680) of Chapter 3 of Part 3 of Division 4 of Title 3 of the
Government Code.
   (b) "Employer" means any person employing another under any
appointment or contract of hire and includes the state, political
subdivisions of the state, and municipalities.
   (c) "Family member" means any of the following:
   (1) A child, which for purposes of this article means a
biological, adopted, or foster child, stepchild, legal ward, or a
child to whom the employee stands in loco parentis. This definition
of a child is applicable regardless of age or dependency status.
   (2) A biological, adoptive, or foster parent, stepparent, or legal
guardian of an employee or the employee's spouse or registered
domestic partner, or a person who stood in loco parentis when the
employee was a minor child.
   (3) A spouse.
   (4) A registered domestic partner.
   (5) A grandparent.
   (6) A grandchild.
   (7) A sibling.
   (d) "Health care provider" has the same meaning as defined in
paragraph (6) of subdivision (c) of Section 12945.2 of the Government
Code.
   (e) "Paid sick days" means time that is compensated at the same
wage as the employee normally earns during regular work hours and is
provided by an employer to an employee for the purposes described in
Section 246.5.
   SEC. 2.    Section 246 of the   Labor Code
  is amended to read: 
   246.  (a)  (1)    An employee who, on or after
July 1, 2015, works in California for the same employer for 30 or
more days within a year from the commencement of employment is
entitled to paid sick days as specified in this section. 
   (2) On and after July 1, 2018, a provider of in-home supportive
services under Section 14132.95, 14132.952, or 14132.956 of, or
Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of
Division 9 of, the Welfare and Institutions Code, who works in
California for 30 or more days within a year from the commencement of
employment is entitled to paid sick days as specified in subdivision
(e) and subject to the rate of accrual in paragraph (1) of
subdivision (b). 
   (b) (1) An employee shall accrue paid sick days at the rate of not
less than one hour per every 30 hours worked, beginning at the
commencement of employment or the operative date of this article,
whichever is later, subject to the use and accrual limitations set
forth in this section.
   (2) An employee who is exempt from overtime requirements as an
administrative, executive, or professional employee under a wage
order of the Industrial Welfare Commission is deemed to work 40 hours
per workweek for the purposes of this section, unless the employee's
normal workweek is less than 40 hours, in which case the employee
shall accrue paid sick days based upon that normal workweek.
   (3) An employer may use a different accrual method, other than
providing one hour per every 30 hours worked, provided that the
accrual is on a regular basis so that an employee has no less than 24
hours of accrued sick leave or paid time off by the 120th calendar
day of employment or each calendar year, or in each 12-month period.
   (4) An employer may satisfy the accrual requirements of this
section by providing not less than 24 hours or three days of paid
sick leave that is available to the employee to use by the completion
of his or her 120th calendar day of employment.
   (c) An employee shall be entitled to use accrued paid sick days
beginning on the 90th day of employment, after which day the employee
may use paid sick days as they are accrued.
   (d) Accrued paid sick days shall carry over to the following year
of employment. However, an employer may limit an employee's use of
accrued paid sick days to 24 hours or three days in each year of
employment, calendar year, or 12-month period. This section shall be
satisfied and no accrual or carryover is required if the full amount
of leave is received at the beginning of each year of employment,
calendar year, or 12-month period. The term "full amount of leave"
means three days or 24 hours. 
   (e) For a provider of in-home supportive services under Section
14132.95, 14132.952, or 14132.956 of, or Article 7 (commencing with
Section 12300) of Chapter 3 of Part 3 of Division 9 of, the Welfare
and Institutions Code, the term "full amount of leave" is defined as
follows:  
   (1) Eight hours or one day in each year of employment, calendar
year, or 12-month period beginning July 1, 2018.  
   (2) Sixteen hours or two days in each year of employment, calendar
year, or 12-month period beginning when the minimum wage, as set
forth in paragraph (1) of subdivision (b) of Section 1182.12 and
accounting for any years postponed under subparagraph (D) of
paragraph (3) of subdivision (d) of Section 1182.12, has reached
$13.00 per hour.  
   (3) Twenty-four hours or three days in each year of employment,
calendar year, or 12-month period beginning when the minimum wage, as
set forth in paragraph (1) of subdivision (b) of Section 1182.12 and
accounting for any years postponed under subparagraph (D) of
paragraph (3) of subdivision (d) of Section 1182.12, has reached
$15.00 per hour.  
   (e) 
    (f)  An employer is not required to provide additional
paid sick days pursuant to this section if the employer has a paid
leave policy or paid time off policy, the employer makes available an
amount of leave applicable to employees that may be used for the
same purposes and under the same conditions as specified in this
section, and the policy satisfies one of the following:
   (1) Satisfies the accrual, carryover, and use requirements of this
section.
   (2) Provided paid sick leave or paid time off to a class of
employees before January 1, 2015, pursuant to a sick leave policy or
paid time off policy that used an accrual method different than
providing one hour per 30 hours worked, provided that the accrual is
on a regular basis so that an employee, including an employee hired
into that class after January 1, 2015, has no less than one day or
eight hours of accrued sick leave or paid time off within three
months of employment of each calendar year, or each 12-month period,
and the employee was eligible to earn at least three days or 24 hours
of sick leave or paid time off within nine months of employment. If
an employer modifies the accrual method used in the policy it had in
place prior to January 1, 2015, the employer shall comply with any
accrual method set forth in subdivision (b) or provide the full
amount of leave at the beginning of each year of employment, calendar
year, or 12-month period. This section does not prohibit the
employer from increasing the accrual amount or rate for a class of
employees covered by this subdivision.
   (3) Notwithstanding any other law, sick leave benefits provided
pursuant to the provisions of Sections 19859 to 19868.3, inclusive,
of the Government Code, or annual leave benefits provided pursuant to
the provisions of Sections 19858.3 to 19858.7, inclusive, of the
Government Code, or by provisions of a memorandum of understanding
reached pursuant to Section 3517.5 that incorporate or supersede
provisions of Section 19859 to 19868.3, inclusive, or Sections
19858.3 to 19858.7, inclusive of the Government Code, meet the
requirements of this section. 
   (f) 
    (g)  (1) Except as specified in paragraph (2), an
employer is not required to provide compensation to an employee for
accrued, unused paid sick days upon termination, resignation,
retirement, or other separation from employment.
   (2) If an employee separates from an employer and is rehired by
the employer within one year from the date of separation, previously
accrued and unused paid sick days shall be reinstated. The employee
shall be entitled to use those previously accrued and unused paid
sick days and to accrue additional paid sick days upon rehiring,
subject to the use and accrual limitations set forth in this section.
An employer is not required to reinstate accrued paid time off to an
employee that was paid out at the time of termination, resignation,
or separation of employment. 
   (g) 
    (h)  An employer may lend paid sick days to an employee
in advance of accrual, at the employer's discretion and with proper
documentation. 
   (h) 
    (i)  An employer shall provide an employee with written
notice that sets forth the amount of paid sick leave available, or
paid time off leave an employer provides in lieu of sick leave, for
use on either the employee's itemized wage statement described in
Section 226 or in a separate writing provided on the designated pay
date with the employee's payment of wages. If an employer provides
unlimited paid sick leave or unlimited paid time off to an employee,
the employer may satisfy this section by indicating on the notice or
the employee's itemized wage statement "unlimited." The penalties
described in this article for a violation of this subdivision shall
be in lieu of the penalties for a violation of Section 226. This
subdivision shall apply to employers covered by Wage Order 11 or 12
of the Industrial Welfare Commission only on and after January 21,
2016. 
   (i) 
    (j)  An employer has no obligation under this section to
allow an employee's total accrual of paid sick leave to exceed 48
hours or 6 days, provided that an employee's rights to accrue and use
paid sick leave are not limited other than as allowed under this
section. 
   (j) 
    (k)  An employee may determine how much paid sick leave
he or she needs to use, provided that an employer may set a
reasonable minimum increment, not to exceed two hours, for the use of
paid sick leave. 
   (k) 
    (   l   )  For the purposes of this
section, an employer shall calculate paid sick leave using any of the
following calculations:
   (1) Paid sick time for nonexempt employees shall be calculated in
the same manner as the regular rate of pay for the workweek in which
the employee uses paid sick time, whether or not the employee
actually works overtime in that workweek.
   (2) Paid sick time for nonexempt employees shall be calculated by
dividing the employee's total wages, not including overtime premium
pay, by the employee's total hours worked in the full pay periods of
the prior 90 days of employment.
   (3) Paid sick time for exempt employees shall be calculated in the
same manner as the employer calculates wages for other forms of paid
leave time. 
   (l) 
    (m)  If the need for paid sick leave is foreseeable, the
employee shall provide reasonable advance notification. If the need
for paid sick leave is unforeseeable, the employee shall provide
notice of the need for the leave as soon as practicable. 
   (m) 
    (n)  An employer shall provide payment for sick leave
taken by an employee no later than the payday for the next regular
payroll period after the sick leave was taken. 
   (o) The State Department of Social Services, in consultation with
stakeholders, shall convene a workgroup to implement paid sick leave
for in-home supportive services providers as specified in this
section. This workgroup shall finish its implementation work by
November 1, 2017, and the State Department of Social Services shall
issue guidance such as an all-county letter or similar instructions
by December 1, 2017.  
   (p) Notwithstanding the rulemaking provisions of the
Administrative Procedure Act (Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code),
the State Department of Social Services may implement, interpret, or
make specific this section by means of an all-county letter, or
similar instructions, without taking any regulatory action. 
   SEC. 3.    Section 1182.12 of the   Labor
Code   is amended to read: 
   1182.12.   (a)    Notwithstanding any other
provision of this part, on and after July 1, 2014, the minimum wage
for all industries shall be not less than nine dollars ($9) per hour,
and on and after January 1, 2016, the minimum wage for all
industries shall be not less than ten dollars ($10) per hour. 
   (b) Notwithstanding subdivision (a), the minimum wage for all
industries shall not be less than the amounts set forth in this
subdivision, except when the scheduled increases in paragraphs (1)
and (2) are temporarily suspended under subdivision (d).  
   (1) For any employer who employs 26 or more employees, the minimum
wage shall be as follows:  
   (A) From January 1, 2017, to December 31, 2017, inclusive,--ten
dollars and fifty cents ($10.50) per hour.  
   (B) From January 1, 2018, to December 31, 2018, inclusive,--eleven
dollars ($11) per hour.  
   (C) From January 1, 2019, to December 31, 2019, inclusive,--twelve
dollars ($12) per hour.  
   (D) From January 1, 2020, to December 31, 2020,
inclusive,--thirteen dollars ($13) per hour.  
   (E) From January 1, 2021, to December 31, 2021,
inclusive,--fourteen dollars ($14) per hour.  
   (F) From January 1, 2022, and until adjusted by subdivision
(c)--fifteen dollars ($15) per hour.  
   (2) For any employer who employs 25 or fewer employees, the
minimum wage shall be as follows:  
   (A) From January 1, 2018, to December 31, 2018, inclusive,--ten
dollars and fifty cents ($10.50) per hour.  
   (B) From January 1, 2019, to December 31, 2019, inclusive,--eleven
dollars ($11) per hour.  
   (C) From January 1, 2020, to December 31, 2020, inclusive,--twelve
dollars ($12) per hour.  
   (D) From January 1, 2021, to December 31, 2021,
inclusive,--thirteen dollars ($13) per hour.  
   (E) From January 1, 2022, to December 31, 2022,
inclusive,--fourteen dollars ($14) per hour.  
   (F) From January 1, 2023, and until adjusted by subdivision
(c)--fifteen dollars ($15) per hour.  
   (3) For purposes of this subdivision, "employer" means any person
who directly or indirectly, or through an agent or any other person,
employs or exercises control over the wages, hours, or working
conditions of any person. For purposes of this subdivision, "employer"
includes the state, political subdivisions of the state, and
municipalities.  
   (4) Employees who are treated as employed by a single qualified
taxpayer under subdivision (h) of Section 23626 of the Revenue and
Taxation Code, as it read on the effective date of this section,
shall be considered employees of that taxpayer for purposes of this
subdivision.  
   (c) (1) Following the implementation of the minimum wage increase
specified in subparagraph (F) of paragraph (2) of subdivision (b), on
or before August 1 of that year, and on or before each August 1
thereafter, the Director of Finance shall calculate an adjusted
minimum wage. The calculation shall increase the minimum wage by the
lesser of three and one-half percent (3.5%) and the rate of change in
the averages of the most recent July 1 to June 30, inclusive, period
over the preceding July 1 to June 30, inclusive, period for the
United States Bureau of Labor Statistics nonseasonally adjusted
United States Consumer Price Index for Urban Wage Earners and
Clerical Workers (U.S. CPI-W). The result shall be rounded to the
nearest ten cents ($0.10). Each adjusted minimum wage increase
calculated under this subdivision shall take effect on the following
January 1.  
   (2) If the rate of change in the averages of the most recent July
1 to June 30, inclusive, period over the preceding July 1 to June 30,
inclusive, period for the United States Bureau of Labor Statistics
nonseasonally adjusted U.S. CPI-W is negative, there shall be no
increase or decrease in the minimum wage pursuant to this subdivision
on the following January 1.  
   (3) (A) Notwithstanding the implementation timing described in
paragraph (1) of this subdivision, if the rate of change in the
averages of the most recent July 1 to June 30, inclusive, period over
the preceding July 1 to June 30, inclusive, period for the United
States Bureau of Labor Statistics nonseasonally adjusted U.S. CPI-W
exceeds 7 percent (7%) in the first year that the minimum wage
specified in subparagraph (F) of paragraph (1) of subdivision (b) is
implemented, the indexing provisions described in paragraph (1) of
this subdivision shall be implemented immediately, such that the
indexing will be effective on the following January 1.  
   (B) If the rate of change in the averages of the most recent July
1 to June 30, inclusive, period over the preceding July 1 to June 30,
inclusive, period for the United States Bureau of Labor Statistics
nonseasonally adjusted U.S. CPI-W exceeds 7 percent (7%) in the first
year that the minimum wage specified in subparagraph (F) of
paragraph (1) of subdivision (b) is implemented, notwithstanding any
other law, for employers with 25 or fewer employees the minimum wage
shall be set equal to the minimum wage for employers with 26 or more
employees, effective on the following January 1, and the minimum wage
increase specified in subparagraph (F) of paragraph (2) of
subdivision (b) shall be considered to have been implemented for
purposes of this subdivision.  
   (d) (1) On or before July 28, 2017, and on or before every July 28
thereafter until the minimum wage is fifteen dollars ($15) per hour
pursuant to paragraph (1) of subdivision (b), to ensure that economic
conditions can support a minimum wage increase, the Director of
Finance shall annually make a determination and certify to the
Governor and the Legislature whether each of the following conditions
is met:  
   (A) Total nonfarm employment for California, seasonally adjusted,
decreased over the three-month period from April to June, inclusive,
prior to the July 28 determination. This calculation shall compare
seasonally adjusted total nonfarm employment in June to seasonally
adjusted total nonfarm employment in March, as reported by the
Employment Development Department.  
   (B) Total nonfarm employment for California, seasonally adjusted,
decreased over the six-month period from January to June, inclusive,
prior to the July 28 determination. This calculation shall compare
seasonally adjusted total nonfarm employment in June to seasonally
adjusted total nonfarm employment in December, as reported by the
Employment Development Department.  
   (C) Retail sales and use tax cash receipts from a 3.9375-percent
tax rate for the July 1 to June 30, inclusive, period ending one
month prior to the July 28 determination is less than retail sales
and use tax cash receipts from a 3.9375-percent tax rate for the July
1 to June 30, inclusive, period ending 13 months prior to the July
28 determination. The calculation for the condition specified in this
subparagraph shall be made as follows:  
   (i) The State Board of Equalization shall publish by the 10th of
each month on its Internet Web site the total retail sales (sales
before adjustments) for the prior month derived from their daily
retail sales and use tax reports.  
   (ii) The State Board of Equalization shall publish by the 10th of
each month on its Internet Web site the monthly factor required to
convert the prior month's retail sales and use tax total from all tax
rates to a retail sales and use tax total from a 3.9375-percent tax
rate.  
   (iii) The Department of Finance shall multiply the monthly total
from clause (i) by the monthly factor from clause (ii) for each
month.  
   (iv) The Department of Finance shall sum the monthly totals
calculated in clause (iii) to calculate the 12-month July 1 to June
30, inclusive, totals needed for the comparison in this subparagraph.
 
   (2) (A) On or before July 28, 2017, and on or before every July 28
thereafter until the minimum wage is fifteen dollars ($15) per hour
pursuant to paragraph (1) of subdivision (b), to ensure that the
state General Fund fiscal condition can support the next scheduled
minimum wage increase, the Director of Finance shall annually make a
determination and certify to the Governor and the Legislature whether
the state General Fund would be in a deficit in the current fiscal
year, or in either of the following two fiscal years.  
   (B) For purposes of this subdivision, deficit is defined as a
negative balance in the Special Fund for Economic Uncertainties, as
provided for in Section 16418 of the Government Code, that exceeds,
in absolute value, 1 percent of total state General Fund revenue and
transfers, based on the most recent Department of Finance estimates
required by Section 12.5 of Article IV of the California
Constitution. For purposes of this subdivision, the estimates shall
include the assumption that only the minimum wage increases scheduled
for the following calendar year pursuant to subdivision (b) will be
implemented.  
   (3) (A)  (i) If, for any year, the condition in either
subparagraph (A) or (B) of paragraph (1) is met, and if the condition
in subparagraph (C) of paragraph (1) is met, the Governor may, on or
before August 1 of that year, notify the Legislature of an initial
determination to temporarily suspend the minimum wage increases
scheduled pursuant to subdivision (b) for the following year. 

   (ii) If the Director of Finance certifies under paragraph (2) that
the state General Fund would be in a deficit in the current fiscal
year, or in either of the following two fiscal years, the Governor
may, on or before August 1 of that fiscal year, notify the
Legislature of an initial determination to temporarily suspend the
minimum wage increases scheduled pursuant to subdivision (b) for the
following year.  
   (B) If the Governor provides notice to the Legislature pursuant to
subparagraph (A), the Governor shall, on September 1 of any such
year, make a final determination whether to temporarily suspend the
minimum wage increases scheduled pursuant to subdivision (b) for the
following year. The determination to temporarily suspend the minimum
wage increases scheduled pursuant to subdivision (b) for the
following year shall be made by proclamation.  
   (C) The Governor may temporarily suspend scheduled minimum wage
increases pursuant to clause (ii) of subparagraph (A) no more than
two times.  
   (D) If the Governor makes a final determination to temporarily
suspend the scheduled minimum wage increases pursuant to subdivision
(b) for the following year, all dates
             specified in subdivision (b) that are subsequent to the
September 1 final determination date shall be postponed by an
additional year.  
  SECTION 1.    Section 1182.12 of the Labor Code is
amended to read:
   1182.12.  (a) Notwithstanding any other provision of this part, on
and after July 1, 2014, the minimum wage for all industries shall be
not less than nine dollars ($9) per hour, on and after January 1,
2016, the minimum wage for all industries shall be not less than
eleven dollars ($11) per hour, and on and after July 1, 2017, the
minimum wage for all industries shall be not less than thirteen
dollars ($13) per hour.
   (b) (1) Except as provided in paragraph (3), commencing on January
1, 2019, the minimum wage shall be automatically adjusted on January
1 of each year to maintain employee purchasing power diminished by
the rate of inflation that occurred during the previous year.
   (2) The minimum wage adjustment shall be made by multiplying the
minimum wage in effect on December 31 of the previous year by the
percentage rate of inflation that occurred during that year, and by
adding the product to the wage in effect during that year. The
resulting total shall be rounded off to the nearest five cents
($0.05). The Division of Labor Standards Enforcement shall publicize
the automatically adjusted minimum wage.
   (3) The Industrial Welfare Commission shall not adjust the minimum
wage pursuant to this subdivision if the average percentage of
inflation for the previous year was negative.
   (4) For purposes of this subdivision:
   (A) "Percentage rate of inflation" means the percentage rate of
inflation specified in the California Consumer Price Index for All
Urban Consumers, as published by the Department of Industrial
Relations, Office of Policy, Research and Legislation, or its
successor index.
   (B) "Previous year" means the 12-month period that ends on August
31 of the calendar year prior to the adjustment.
   (c) The Industrial Welfare Commission shall not reduce the minimum
wage prescribed by this section.
   (d) This section shall not be construed to preclude an increase of
the minimum wage by the Industrial Welfare Commission to an amount
that is greater than the rate calculated pursuant to subdivision (b)
or to preclude or supersede an increase of the minimum wage by any
local government or tribal government that is greater than the state
minimum wage.
   (e) This section applies to all industries, including public and
private employment. 
                      ____ CORRECTIONS  Heading--Lines 3, 7 and 8.
Text--Pages 6, 7, 11 and 12.
                     ____