Senate Bill (SB) 525 was signed into law to phase in statewide minimum wage increases for health care workers employed by covered health care facilities. Beginning on October 16, 2024, health care workers employed by certain health care facilities will start to see their minimum wage gradually increase. The California Department of Industrial Relations developed a FAQ resource which provides further information on the types of covered health care facilities that are subject to the minimum wage requirements and when it becomes effective.

CAMFT will update this resource as more information becomes available and/or clean-up language is made to the law.   

Disclaimer: The law as currently written remains vague and unclear as it pertains to which individuals and health care facilities are impacted. We recognize that licensed and pre-licensed MFTs in California work in a wide range of health care settings that include private practices, agencies and clinics, schools, hospitals, and more. This resource does not add interpretation beyond what is defined in statute and is not meant to be a resource that lists every job title or work setting to which this law applies. CAMFT members are encouraged to use this resource to obtain a general understanding of which health care facilities are covered and to determine if it may impact you. If you have questions about how this law may impact you or your business, we strongly recommend seeking legal consultation with an employment/labor law attorney. 

Who is Covered in the Health Care Minimum Wage Law? 

The minimum wage law applies to employees of a health care facility employer (see list below) who provide patient care, health care services, or services supporting the provision of health care (Labor Code Section 1182.14(b)(2)(A)). This is generally inclusive of health care workers and other individuals supporting the provision of health care. Contracted (1099s) or subcontracted employees are also covered if the health care facility employer controls the wages, hours, or working conditions of the contracted employee or if the contracted employee works primarily at the health care facility (Labor Code Section 1182.14(b)(2)(B)). 

What does it mean to be an Employee of a Health Care Facility Employer? 

The law does not provide a strict definition on what an “employee” means. To put it vaguely, an employee is a person who is allowed to work for an employer (Labor Code Sections 1182.14(b)(4)-(6)).  Typically, “employees” are individuals who contract (1099) with or have a W2 tax classification with an employer.  According to communications by the Senate, volunteers are not included in this law since they don’t meet the definition of an employee.[i]

What Health Care Facilities are Covered in the Health Care Minimum Wage? 

Health care workers who are employed at, or meet the situations to be a contracted or subcontracted employee, with the below covered health care facilities are covered by the health care minimum wage law: 

1. Facility or other work site that is part of an integrated health care delivery system as described in Labor Code Section 1182.14(b)(13).
2. Licensed general acute care hospital, including a distinct part of any such hospital, as described in Health and Safety Code Section 1250(a).
3. Licensed acute psychiatric hospital, including a distinct part of any such hospital, as described in Health and Safety Code Section 1250(b).
4. Special hospital. These are health facilities with medical and dental staff that provide inpatient or outpatient care in dentistry or maternity as described in Health and Safety Code Section 1250(f).
5. Licensed skilled nursing facility, as described in Health and Safety Code Section 1250(c), if owned, operated or controlled by a hospital or integrated health care delivery system or health care system.
6. A patient’s home when health care services are delivered by an entity owned or operated by a general acute care hospital or acute psychiatric hospital.
7. A licensed home health agency. These are organizations providing skilled nursing services to persons in their temporary or permanent place of residence as described in Health and Safety Code Section 1727.
8. A clinic, as described in Health and Safety Code Section 1204, including specialty care clinic or a dialysis clinic. These are federally qualified health centers (FQHCs).
9. A psychology clinic as described in Health and Safety Code Section 1204.1.
10. Specific clinics operating as outpatient departments of hospitals, institutions of learning that teaches a recognized healing art, and nonprofits that conduct medical research and health education and provides health care to patients through physicians and surgeons as described in Health and Safety Code Section 1206 subdivisions (d), (g), and (l).
11. Licensed residential care facility for the elderly, as described in Health and Safety Code Section 1569.2(o) if affiliated with an acute care provider or owned, operated, controlled by a general acute care hospital, acute psychiatric hospital or the parent entity of a general acute care hospital or acute psychiatric hospital.
12. Psychiatric health facility as described in Health and Safety Code Section 1250.2.
13. Mental health rehabilitation centers as described in Welfare and Institutions Code Section 5675.
14. Community clinics as described in Health and Safety Code Section 1204(a), 1206(h) and 1206(b).
15. Rural health clinic as defined in United States Code Title 42 Section 1396d(l).
16. Urgent care clinic.
17. Ambulatory surgical center certified to participate in the Medicare Program under Title XVIII of the federal Social Security Act.
18. Physician group.
19. County correctional facility that provides health care services.
20. County mental health facility.

The law does not include the following as a covered health care facility: 

• Health care facilities owned, controlled, or operated by the state or any state entity. That includes state agencies of the executive branch, California State Universities, or California Community Colleges.  

• Tribal clinics or facilities operated by a federally recognized Indian tribe, tribal organization, or urban Indian organization. 

These notable health care facilities and working settings are not explicitly covered in the health care minimum wage:  

• School counseling centers. 

• Adult residential facilities not including licensed residential care facilities for the elderly. 

• Social rehabilitation facilities. 

• Community re-entry facilities. 

• Any agency or clinic that does not meet the definition of a “covered health care facility” outlined above, including those that are funded by private grants (i.e. not funded by federal or governmental grants).

[i] NOTE: Employers who also use volunteers should always make sure they have classified providers correctly to ensure they are not violating California Labor Law. To learn more, please read CAMFT’s legal article Labor Commission Reviews Unpaid AMFT Internships.   

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