California health workers may face rude awakening with $25 minimum wage law

The hospital association’s legal challenge referenced in part layoffs and reduced working hours imposed by Centinela Hospital Medical Center after Inglewood’s ordinance took effect.

But Centinela said the reduction was entirely unrelated to the ordinance and that all staff were offered alternate positions, which many accepted.

“Centinela Hospital also has since added many more jobs in new clinical positions above minimum wage scale,” the hospital said in a statement.

Service Employees International Union-United Healthcare Workers West, the prime backer of both the local ordinance and the statewide law, sued the hospital in April 2023 alleging that it cut workers’ hours to offset the higher minimum wage. The case is still pending.

The union did not respond to repeated requests for comment.

In a court filing, however, the union and city of Inglewood said similar employer restrictions in previous minimum wage laws have survived.

The ordinance “merely sets the backdrop for collective bargaining negotiations,” and does not bar employers from locking out employees or hiring replacement workers during a strike. Employers can still lay off workers or reduce their hours, they said, so long as they don’t do so to fund the higher minimum wage.

But Fischer agreed with the hospital association that layoffs and reductions in employees’ total compensation packages are “obvious responses by an employer to rising compensation costs.”

Restricting employers’ options would violate federal labor relations rules, he said.

“The minimum wage an employer has to pay its employees will invariably affect the total amount of compensation it is able or willing to pay,” he wrote “This will then invariably affect the number of employees it can retain and the number of hours those employees will be scheduled to work.”

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This article was produced by KFF Health News, which publishes California Healthline , an editorially independent service of the California Health Care Foundation.