Jerry Brown signs $15 minimum wage in California

Gov. Jerry Brown, casting a living wage as a moral imperative while questioning its economic rationale, signed legislation Monday raising California’s mandatory minimum to $15 an hour by 2022, acting within hours of a similar bill signing in New York.

The promised wage increases cemented a major victory for labor unions and their national Fight for 15 movement, whose intensity has heightened in this presidential election year.

With the bills enacted Monday, New York and California became the first states in the nation to adopt plans to raise their statewide minimums to $15.

In California, the minimum wage bill’s approval comes one week after Brown, Democratic lawmakers and labor leaders announced an agreement on the wage increase, averting a brawl on the November ballot.

Brown, a fiscal moderate, had previously expressed reservations about a wage increase. But amid growing concern about income inequality in California – and public opinion polls showing strong support for raising the minimum wage beyond its current $10 – his hand was forced.

The compromise Brown offered lawmakers and ultimately signed includes a provision allowing the governor to postpone a wage increase in the event of an economic downturn. It replaces a ballot measure that, if passed, would have raised the minimum wage to $15 by 2021, a year faster.

Brown, traveling to Los Angeles to sign the landmark bill, remained hesitant about the economic effect of raising the minimum wage, saying, “Economically, minimum wages may not make sense.”

But speaking in the state’s largest media market, he said work is “not just an economic equation,” calling labor “part of living in a moral community.”

“Morally and socially and politically, they (minimum wages) make every sense because it binds the community together and makes sure that parents can take care of their kids in a much more satisfactory way,” Brown said.

The wage measures in California and New York reverberated nationally. Hillary Clinton, the front-runner for the Democratic presidential nomination, joined New York Gov. Andrew Cuomo for a rally in his state moments before Brown signed the California law.

President Barack Obama issued statements praising the bill signings, and Clinton’s rival, Bernie Sanders, said in a prepared statement that he was “proud that today two of our largest states will be increasing the minimum wage to a living wage of $15 an hour.”

The California legislation will raise the statewide minimum to $10.50 on Jan. 1 for businesses with 26 or more workers, the first of several incremental increases to $15, with future raises tied to inflation. Smaller businesses will have an additional year to phase in each increase.

The law follows measures in Los Angeles and San Francisco, among other cities, to gradually raise their own minimum wages to $15. It is expected to affect millions of low-wage workers and businesses that employ them, especially in the state’s agriculture, restaurant and retail industries. Some 6 million Californians currently earn the minimum wage.

By 2022, a full-time minimum-wage worker would see annual earnings increase to $30,000 from $20,000 today.

Senate President Pro Tem Kevin de León framed the legislation Monday as a recognition of “the contributions of hardworking men and women” throughout the state.

“No one who works full time should live in poverty,” he said.

California Labor Federation Executive Secretary-Treasurer Art Pulaski said in prepared remarks that “the statement California made today will echo throughout the country.”

In a concession to the state’s influential labor unions, the bill will also provide in-home health aides three annual sick days.

The Democratic-controlled Legislature passed the measure quickly last week, and on partisan lines. While labor unions and their Democratic allies celebrated the bill’s passage, no Republican supported it in either house.

Republicans and business groups said rising wages will force employers to increase prices or to cut costs by laying off workers or reducing their hours.

Research on the economic effect of a minimum wage increase is mixed, with findings ranging from little or no impact on employment rates, on one hand, to rising unemployment, on the other.

The measure will not come without a cost. According to the state Department of Finance, a $15 minimum would cost California government about $4 billion a year.

Rob Lapsley, president of the California Business Roundtable, said in a prepared statement that raising the minimum wage could prove harmful in a state whose economic recovery has been uneven, with many areas still facing high unemployment.

The wage increase, he said, “comes on top of increased legislation, regulations and policies that continue to make California one of the most expensive states in the nation to do business.”

This story was originally published April 4, 2016 at 3:55 PM with the headline "Jerry Brown signs $15 minimum wage in California."