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Cupertino Wage Watch

Cupertino Minimum Wage Increase
The Cupertino Minimum Wage will increase from $10.00 to $12.00 per hour effective January 1, 2017

Proposed City-wide traffic impact fee 1

On Tuesday, October 4, 2016 the Cupertino City Council enacted Ordinance No. 2151, establishing a citywide minimum wage as part of a regional effort to increase the minimum wage to $15 by 2019. This timeline is more aggressive than the minimum wage law signed by Governor Jerry Brown on April 4, 2016, which increases the State minimum wage to $15 by 2022.

Effective Date   Cupertino
Schedule
 State Schedule
More than 25 EE 25 or less EE
January 1, 2017 $12.00 $10.50 $10.00
January 1, 2018 $13.50 $11.00 $10.50
January 1, 2019 $15.00 $12.00 $11.00 
January 1, 2020 $15.35* $13.00 $12.00  
January 1, 2021 $15.65* $14.00 $13.00
January 1, 2022 $16.00* $15.00 $14.00 
January 1, 2023 $16.40* $15.30** $15.00
* Estimate based on the historical CPI-W in Bay Area Statistical Area of 2.2%
** Estimate based on the historical CPI-W in U.S. of 1.7%

The City began studying the issue last fall when a regional advisory committee was formed to study the economic impacts of gradually increasing the minimum wage to $15/hour by 2019 in Santa Clara County. Staff presented the results of the economic analysis to Council on May 17, 2016. Per Council direction, staff conducted extensive outreach to Cupertino’s business community in partnership with the Cupertino Chamber of Commerce to gather feedback on the proposal. This information was presented to Council on September 20th.

Ordinance No. 2151: Ordinance of the City of Cupertino to add Chapter 3.37 (Minimum Wage Ordinance) to Title 3 (Revenue and Finance) of the Cupertino Municipal Code to establish a citywide minimum wage.

Please see our Frequently Asked Questions to find out more information about the Minimum Wage.

Economic Analysis Summary
Last fall, a regional advisory committee commissioned UC Berkeley’s Institute for Research on Labor and Employment (IRLE) to analyze the impacts of a potential increase in the minimum wage in Santa Clara County. The key findings of the economic analysis indicate that an increase to the minimum wage would significantly increase average earnings of low-wage workers and their families, with relatively minor impacts to businesses and consumers. Specifically, the study found:

  • Average pay increase of $3,200 (19.4% of annual earnings) for 250,000 workers (25% of workforce).
  • Affected workers are household breadwinners, bringing home half of their family’s income on average: 96% of workers who would receive pay increases are over 20 years old; 57% are over 30.
  • 84% of workers benefiting from an increased minimum wage reside in Santa Clara County.
  • Nearly half of workers receiving increases work in the restaurant, retail or administrative and waste management industries.
  • Average payroll increases for employers of 1.0% across industries (9.6% for restaurants) countywide.
  • Average price increase of 0.2% across industries (2.9% for restaurants) passed on to consumers with the majority of the increases absorbed through automation, improved productivity and reduced turnover.
  • Net loss of 1,470 jobs by the end of 2019, corresponding to 0.1% of county employment.

 

Overall, the analysis concludes that the resulting improvement in living standards for low-income workers would outweigh the small effects on employment. A more detailed report will be available in June 2016.

Beyond the economic analysis, a countywide survey of over 500 employers in industries most likely to be impacted by a minimum wage increase was conducted by BW Research Partnership. The results of the survey show that the majority of affected employers anticipate increasing prices for customers (66%) but that their employees will be more satisfied and productive with the wage increase (66%). Surprisingly, 76% of surveyed employers believe a minimum wage increase makes sense given the high cost of living in the Silicon Valley and that doing so will reduce inequality (65%). The vast majority (75%) agree with a regional approach at the county level. However, most (61%) believe that a minimum wage increase will make it harder to start and grow local businesses.

 

Last updated: 1/3/2017 5:29:47 PM