California has one of the highest minimum wages in the United States, reflecting the state’s high cost of living and commitment to supporting workers. Understanding the minimum wage in California is crucial for both employers and employees to ensure compliance and fair compensation. This guide provides a comprehensive overview of the California minimum wage, focusing on the changes taking effect in 2025 and beyond.
As of January 1, 2025, the statewide minimum wage in California is $16.50 per hour for all employers, regardless of size. This increase marks another step in California’s ongoing efforts to raise the minimum wage and improve the financial well-being of its workforce. This rate applies to most employees across the state, with a few exceptions for specific industries and localities.
This increase also impacts the minimum salary requirements for exempt employees in California. To be classified as exempt from overtime pay, employees must earn at least two times the state’s minimum wage. Therefore, as of January 1, 2025, exempt employees in California must receive an annual salary of no less than $68,640, or $1,320 per week. Employers must ensure they meet this salary threshold to properly classify employees as exempt. It’s also mandatory for employers to post the updated Minimum Wage Order and the Wage Order applicable to their specific workplace, which can be downloaded from the California Department of Industrial Relations (DIR) website.
Industry-Specific Minimum Wage Laws in California
Beyond the general state minimum wage, California has implemented specific minimum wage laws for certain industries, recognizing the unique economic factors within these sectors.
Fast Food Workers Minimum Wage
California has made significant strides in increasing the minimum wage for fast food workers. As of April 1, 2024, the minimum wage for fast food workers at national fast food chains (those with more than 60 establishments nationally) is $20 per hour. This landmark legislation aims to address the often demanding and essential work performed by fast food employees.
The responsibility for setting future minimum wage increases for fast food workers lies with the Fast Food Council. This council has the authority to increase the hourly minimum wage annually, capped at either 3.5% or the Consumer Price Index increase, whichever is lower. The Council can also decide on a single statewide minimum wage for fast food workers or adjust it by region, depending on economic conditions. As of now, the Council is still deliberating on potential further wage increases for 2025, with announcements expected in the future.
It’s important to note that certain establishments are exempt from the fast food minimum wage law. These exemptions include bakeries that produce and sell bread on-site as a standalone menu item, and restaurants located within grocery stores where the grocery establishment directly employs the restaurant staff.
Healthcare Workers Minimum Wage
California has also enacted legislation to raise the minimum wage for healthcare workers, recognizing their critical role and often demanding work environments. Minimum wage increases for California healthcare workers began on October 16, 2024.
The law mandates a tiered system of minimum wage increases for healthcare workers based on the type of healthcare facility. For covered healthcare facilities operated by counties, the minimum wage increase took effect on January 1, 2025. For other types of covered employers, increases are scheduled to take effect on July 1, 2025.
Salaried employees in covered healthcare facilities must also meet specific minimum salary requirements. They must earn a monthly salary equivalent to no less than 150% of the healthcare minimum wage or 200% of the otherwise applicable minimum wage, whichever is greater. For detailed information on specific minimum wage rates for different types of healthcare facilities and the phased implementation schedule, the DIR provides a Health Care Worker Minimum Wage Frequently Asked Questions page.
Local Minimum Wage Rates in California
In addition to the state and industry-specific minimum wages, many cities and counties in California have established their own local minimum wage ordinances. These local rates are often higher than the state minimum wage, reflecting the even higher cost of living in certain areas. Employers are obligated to pay the higher wage rate if a local ordinance mandates a minimum wage exceeding the state rate.
Several localities in California increased their minimum wage rates on January 1, 2025. Some key examples include:
- Belmont: $18.30 per hour
- Burlingame: $17.43 per hour
- Cupertino: $18.20 per hour
- Daly City: $17.07 per hour
- East Palo Alto: $17.45 per hour
- El Cerrito: $18.34 per hour
- Foster City: $17.39 per hour
- Half Moon Bay: $17.47 per hour
- Hayward: $17.36 per hour (for companies with 26 or more employees)
- Los Altos: $18.20 per hour
- Menlo Park: $17.10 per hour
- Mountain View: $19.20 per hour
- Palo Alto: $18.20 per hour
- Petaluma: $17.97 per hour
- Redwood City: $18.20 per hour
- San Diego: $17.25 per hour
- San Jose: $17.95 per hour
- San Mateo: $17.95 per hour
- Santa Clara: $18.20 per hour
- Santa Rosa: $17.87 per hour
- Sunnyvale: $19.00 per hour
- West Hollywood: $19.65 per hour (non-hotel employees)
This is not an exhaustive list, and numerous other cities and counties in California have their own minimum wage rates. Employers should consult the specific regulations of the localities where their employees work to ensure compliance.
Staying Compliant with California Minimum Wage Laws
Navigating the complexities of California’s minimum wage laws requires diligence and attention to detail. Employers must remain informed about both state and local regulations, as well as industry-specific requirements. Regularly checking for updates from the Department of Industrial Relations and local government websites is crucial for maintaining compliance.
In conclusion, understanding “What Is Minimum Wage In California” involves considering not just the statewide rate but also industry-specific laws and local ordinances. By staying informed and proactive, employers can ensure they are meeting their obligations and providing fair wages to their employees in California.
