Proposition 32 would increase California’s hourly minimum wage from $16 to $17 for employees working for employers — public and private — with 26 or more employees for the rest of 2024. The hourly minimum wage for those employees effective Jan. 1 would be $18. The hourly minimum wage for employees working for employers with up to 25 employees would be $17 on Jan. 1 and $18 on Jan. 1, 2026.
Prop. 32 would not affect higher industry- and city-specific minimum wages in the state. For example, most fast-food employers must pay their employees at least $20 per hour. And minimum wages higher than the state minimum wage some California cities have adopted will continue to govern work performed in those areas.
Here are three ways age of Prop. 32 will affect San Diegans.
The city of San Diego minimum wage will increase
The hourly minimum wage for work performed inside San Diego city limits is $16.85. By ordinance, the city’s minimum wage is adjusted each Jan. 1 for inflation. On Oct. 1, the city announced the minimum wage for all employees regardless of employer size starting Jan. 1 will be $17.25 — but only if Prop. 32 doesn’t .
The city announced on its minimum wage program webpage, “If Proposition 32 is ed on November’s ballot, the City’s 2024 minimum wage will automatically increase to $17.00 per hour and the 2025 minimum wage will increase to $18.00 per hour for all employers within the geographic boundaries of the City of San Diego.”
The statewide minimum salary for exempt employees will rise
Full-time employees exempt from entitlement to overtime pay, such as most white-collar executives and professionals, must be paid a salary of at least twice the state hourly minimum wage based on 2,080 hours of work per year. In 2024, the minimum annual salary for exempt employees was $66,560. If Prop. 32 es, the minimum annual salary for exempt employees of large employers will jump immediately to $70,720 and to $74,880 effective Jan. 1.
Unknown impact on overall employment
In the voter information guide, the Legislative Analyst downplays Prop. 32’s likely impact. The analyst acknowledges higher labor costs will lead some businesses to raise their prices, but says increases “likely would be smaller than one-half of 1 percent.” The analyst says the number of jobs in California could go up or down if Prop. 32 es, but predicts any change in overall employment “likely would be smaller than one-quarter of 1 percent.”
Prop. 32’s impact on wages is a matter of simple arithmetic. And Prop. 32 will lead to higher prices, though how much higher is uncertain. The key unknown is whether overall employment will rise or fall should Prop. 32 .
On Sept. 30, the Union-Tribune’s opinion section published contrasting essays addressing that question. Labor leader Lorena Gonzalez Fletcher and Joe Sanberg, the proposition’s lead sponsor, argued that if low-wage workers are paid more, local businesses will have “more customers spending more money, which means those businesses do better and have to hire more workers.” They added that “since California raised the minimum wage for fast-food workers, there have been 11,000 more fast-food jobs created in California.”
Kim Phan, co-owner of Crab Hut family restaurants in San Diego, by contrast, argued age of Prop. 32 will “lead businesses to limit workers’ hours, cut jobs and even close locations.” The California Chamber of Commerce and other opponents argued in the voter guide that “this job loss especially impacts our vulnerable populations the most, with young African-American, Latino, and non-college educated workers trying to find their first jobs facing the biggest burdens.”
Your vote will depend on whose prediction about the disputed unknown you conclude ultimately is more likely to be proven right. What will remain unknown is what would have happened had the voters chosen the rejected option instead. That’s true about everything on the ballot, candidates and propositions alike.
Eaton is a partner with the San Diego law firm of Seltzer Caplan McMahon Vitek where his practice focuses on defending and advising employers. He also is an instructor at the San Diego State University Fowler College of Business where he teaches classes in business ethics and employment law. He may be reached at [email protected].
