INGLEWOOD – A medical industry challenge to a new minimum wage ordinance in Inglewood, California, suggests layoffs and reductions in hours and benefits, including cuts to premium pay and vacation time, could be one result of a state law set to begin phasing in in June.
The California Hospital Association brought a partly successful legal challenge to Inglewood’s $25 minimum wage ordinance, which barred employers from taking those sorts of steps to offset their higher costs.
“Layoffs, reductions in premium pay rates, reductions in non-wage benefits, reductions in hours, and increased charges are consequences of an employer having less money to spend—which will necessarily be the case given the significant increase in spending on wages due to the minimum wage,” the association said in its lawsuit. Additional examples include reducing health coverage and charging for parking or work-related equipment.
U.S. District Judge Dale S. Fischer agreed with the hospital industry in a March 11 tentative ruling when he shot down the portion of Inglewood’s ordinance banning layoffs and clawbacks by employers, while allowing the rest of the ordinance to remain in effect. He gave the sides time to object to his preliminary decision, though none did.
Read more here.