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Minimum wage increase in 2021, another hurdle for local businesses during pandemic

The minimum wage for Californians will increase from $12 to $13 an hour for businesses with less than 26 employees. Some businesses have already been hit by the pandemic, and a wage increase makes it more difficult.

Posted: Jan 1, 2021 3:00 AM

CHICO, Calif. - With the new year comes new laws and another minimum wage increase.

But it means money gets just that much tighter for businesses, especially when some have half of their business shutdown because of the pandemic.

"They totally deserve it, and it's a good thing, but right now it's a hard thing," said Charlie Barrett, next to his wife and co-owner of Secret Trail Brewery in Chico. "And we're gonna make it work."

Starting in 2021, the minimum wage for California employees will increase by one dollar per hour, The increase will go from 12 to 13 for businesses with less than 26 employees, and 13 to 14 for businesses with more.

"It's a double-edged sword," said Michelle, "because they need it more because of the pandemic, because of the lack of tips and everything else. We'll do what we need to do to make sure they get it, but it's just tough right now."

The pandemic has closed the brewery's bar and patio since dining of any kind must be closed under the regional stay-at-home order. They follow all of the stay-at-home order guidelines, even if it hurts their bottom line.

"We're only allowed for take-out so it's really impacted business and then having to come up with an extra dollar an hour per employee, it's just tough," said Michelle.

Phil Feser, of Rush Personnel Services, a company that helps employees and employers fill positions, says the increase will hit smaller businesses harder.

"Yeah, it affects smaller businesses more because they may only have two or three employees but they don't have as much income," said Feser over the phone. "Larger companies, they may be able to absorb that cost easier."

"It is something that we'll have to do honestly, but that's just the way business works," said Charlie Barrett when asked whether a wage increase would cause the cost of beer to up in price as well. "Everything is costing us more, it's, unfortunately, gonna cost our customers a bit more."

"We are adjusting our prices to help us cover, just a bit," said Michelle. "It's just with COVID right now and being shut down and not being allowed to have customers, it makes it pretty painful."

Several other businesses said off-camera no matter what the protocols are for the new year when it comes to it, they'll follow them.

In 2021, businesses are also required to notify employees and customers of a coronavirus exposure within 24 hours. This new law will last until 2023.

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