California sees uptick in minimum wage violations

LOS ANGELES - Minimum wage violations have more than doubled in California since 2014, according to new data. 

The study published by Rutgers University's School of Management and Labor Relations (SMLR) found an estimated average of $2.3 billion to $4.6 billion in earned wages were lost by workers each year from 2014 to 2023 due to minimum wage violations across four major metro areas - Los Angeles, San Diego, San Francisco, and San Jose. 

Data revealed California workers lose up to $4,000 per year in those major metro areas, with over 7% of workers in the LA metro area paid below the California state minimum wage, compared to 3-5% of workers across the other three areas studied. 

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The majority of lost wages were in the LA metro area, where analysts estimated an average of $1.6 to $2.5 billion was lost a year during the study period.

Workers who were at a higher risk of experiencing minimum wage violations are those employed in private households (such as nannies and childcare workers), food services and drinking places (restaurants, bars, etc.), and personal and laundry services, the study found.

Last year alone, there was a 56% increase in violations, affecting nearly 1.5 million workers.

In April, the state's new $20 minimum wage law went into effect, under a deal made last year between labor unions and the industry that helped avoid a costly referendum on the November 2024 ballot.

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Since the minimum wage went up, however, many restaurants have raised their prices and one research company looked at 20 different fast food chains and found that many of their items went up in cost. 

Which ones got more expensive? Wendy's raised its prices by about 8%, while Chipotle hiked up its prices by 7.5%. Starbucks raised the prices of its menu items by 7%, while Taco Bell hiked its prices by 3%. Burger King raised its prices by 2%, according to Kalinowski Equity Research.

To see the full study on minimum wage theft, tap or click here.