California Democrats have reached an agreement to postpone a minimum wage increase for approximately 426,000 healthcare workers to address the state's budgetary concerns.

California Strikes Deal to Address $46.8B Deficit

The agreement reached between Gov. Gavin Newsom and legislative leaders are a crucial step in addressing the significant financial challenges faced by the nation's most populous state. 

This plan aims to tackle a staggering $46.8 billion shortfall, marking the second consecutive year that California has grappled with a multibillion-dollar deficit, AP reported.

Healthcare workers were scheduled to receive a salary increase on July 1 as part of a long-term plan to gradually raise their pay to $25 per hour over the next ten years. If approved by the Legislature next week, they could potentially receive the raise on October 15. 

However, this is contingent upon California's revenues between July and September exceeding the estimated amount by at least 3%.

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Proposed Wage Hikes for Healthcare Workers

Here are the proposed increases that were scheduled to take effect on July 1:

1. For dialysis clinics and large health systems with over 10,000 employees, there will be an increase in the minimum wage. By 2024, the minimum wage will be $23 per hour, followed by $24 in 2025 and $25 in 2026.

2. For hospitals that serve a significant number of Medi-Cal and Medicare patients, as well as freestanding rural hospitals, the hourly wage is set to be $18 in 2024. This wage will then increase by 3.5% annually, reaching $25 by 2033.

3. Community clinics will see an hourly wage of $21 in 2024, which will then increase to $22 in 2026 and $25 in 2027.

4. Healthcare employees from various sectors will see a gradual increase in their minimum wage over the next few years. By 2024, the minimum wage will be raised to $21 per hour, followed by a further increase to $23 in 2026, and finally reaching $25 by 2028.

According to AS USA, California is among the states that boast a minimum wage surpassing the federal rate of $7.25 per hour. Additionally, this state boasts some of the highest base salaries in the nation, with a minimum wage of $16 per hour for most workers. 

Starting April 1, fast food employees will be earning a minimum salary of $20 per hour. Legislation has been recently approved to gradually raise the base rate for health care workers to $25 per hour over the course of the next decade.

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