California voters have rejected a ballot measure that would have increased the state's minimum wage to $18 on January 1, 2025. Defeated by a narrow margin of 50.82 percent to 49.18 percent, Proposition 32 would have made California the first state in the Union to have an $18 minimum wage. The California Chamber of Commerce and California Restaurant Association praised the outcome as a win for businesses and consumers who have seen costs rise in recent years.
The failure of Proposition 32 marks a break with previous increases that have doubled the minimum wage since 2010. In 2016, Governor Jerry Brown signed SB 3 into law, setting annual increases to the minimum wage until it reached $15 in 2022 and allowing further annual increases to match inflation. These inflation adjustments brought the minimum wage to $16 in January 2024. And then in April, Governor Newsom signed legislation that set a $20 minimum wage for fast-food workers. Proposition 32, if passed, would have followed with an immediate increase to $17 before rising to $18 on January 1, 2025 for employers with 26 or more workers. For employers with 25 or less, the increase to $18 would have been delayed a year to 2026.
Employers should note that many cities and counties have separate minimum wage ordinances that exceed the state minimum wage.
This article is presented for informational purposes only and is not intended to constitute legal advice.
