California Senate Passes $25 Minimum Wage for Health Care Workers

In a landmark decision, the California state Senate has passed a bill that would significantly increase the minimum wage for health care workers and support staff to $25 per hour. The legislation, authored by Democratic Sen. Maria Elena Durazo and backed by the Service Employees International Union (SEIU), aims to improve the wages and recognition of workers in the health care industry.

The bill received unanimous support from Democratic senators but did not garner a single Republican vote. It mandates that all health care facilities, including dialysis clinics and acute psychiatric hospitals, pay their employees a minimum wage of $25 per hour. The scope of eligible workers is broad and includes not only nurses and caregivers but also janitors, food service workers, housekeepers, and gift shop employees, as long as they provide direct or indirect support for patient care.

Senator Durazo emphasized that while the bill could not address all the challenges in the health care system, its primary goal was to elevate the role and status of the workers who provide essential services. The proposed wage increase will be implemented incrementally, starting with a raise to $21 per hour for one year, commencing on June 1, 2024. It will then escalate to the intended rate of $25 per hour.

According to a report from the University of California, Berkeley’s Labor Center, the $25 minimum wage would result in an estimated 3% increase in operational costs for health facilities. On average, eligible health care workers would experience a pay raise of approximately $5.74 per hour. However, a study commissioned by the California Hospital Association, which opposes the bill, projects that the higher wage rate would drive up total annual costs for the health care system by approximately $8 billion in 2024, ultimately rising to $11.3 billion by 2030.

Rony Berdugo, the vice president of state advocacy for the hospital association, criticized the bill for imposing a top-down wage increase without considering the economic realities and unique circumstances faced by health care providers in diverse communities across the large state of California. Some Republican senators echoed these concerns, cautioning against the potential financial strain on the health care system.

Even some Democratic senators who ultimately voted in favor of the legislation expressed apprehensions regarding its financial feasibility and the potential for health care employers to relocate or shut down in response to the increased costs. Senator Dave Min highlighted his worries about the bill’s unintended consequences, particularly the risk of diminishing health care facilities at a time when they are most needed.

Nevertheless, the bill enjoys strong support from unions, who argue that health care employees are overworked and undercompensated. The SEIU, representing 2 million members in health care, the public sector, and property services in the U.S., Canada, and Puerto Rico, has been at the forefront of advocating for the $25 minimum wage. Union members recently staged marches at the state Capitol, the headquarters of the California Hospital Association, and the California Primary Care, demanding fair compensation for their work.

The bill now proceeds to the Assembly, where its fate will be determined. If passed, it will return to the Senate for final approval before potentially becoming law.

In a related development, there are discussions surrounding the possibility of implementing a $25 minimum wage for tourism and hospitality workers in Los Angeles. Councilman Curren Price has proposed an increase to $25 per hour for airport and hotel workers, with subsequent annual raises of $1 until 2028, reaching a wage of $30 per hour. The proposal aims to address the growing disparity between wages and the rising cost of living, particularly as Los Angeles prepares to host several significant global events in the coming years.