Written by

Kari J. BrownLisa Ann Hilario

2026 California Minimum Wage Increases to $16.90 per Hour 

Effective January 1, 2026, the California minimum wage will increase to $16.90/hour (up from $16.50/hour).  This new wage applies to all employers (regardless of size) unless they are subject to a higher minimum wage specific to their industry or a minimum wage ordinance in the city or county where their employees work.

2026 California Minimum Salary for Exempt Employees Increases to $70,304 per Year

To be exempt from timekeeping, overtime and rest/meal break laws, California law requires that exempt employees be paid a salary of at least two times the State minimum wage.*  With the increase in the California minimum wage to $16.90/hour, the minimum exempt employee salary will increase to $70,304/year (up from $68,640/year) on January 1, 2026.

Exempt health care workers may be entitled to a higher minimum salary depending on the minimum wage that applies to their employer.  See below and Health Care Worker Minimum Wage FAQ FAQ 16 for more information.

*This minimum salary requirement is just one element of the exemption employers must satisfy to lawfully classify an employee as exempt.  In addition, exempt employees must be paid on a “salary basis” and their duties must meet other requirements of the executive, administrative, professional, or a handful of other exemptions set out in the Industrial Welfare Commission Order that applies to your industry or occupation.  The exemptions can be found in Section 1 of the Wage Orders available at California Wage Order Industries.

Fast Food Worker Minimum Wage

Certain employers in the fast food industry remain subject to a $20/hour minimum wage.  To find out if this law applies to your business, see the Division of Labor Standards Enforcement Frequently Asked Questions at Fast Food Minimum Wage FAQ.

Health Care Worker Minimum Wage and Minimum Exempt Employee Salary

A different California law sets a higher minimum wage for employees who (1) work for certain “health care facilities” and (2) provide health care services or support the provision of health care.  The health care worker minimum wage ranges from $18.63/hour to $24/hour depending on the type and size of the employer.

Exempt health care workers must receive a salary of at least 1.5 times the health care worker minimum wage or two times the state minimum wage, whichever is greater.

For more information about the health care worker minimum wage and minimum exempt employee salary, see the Division of Labor Standards Enforcement Frequently Asked Questions at Fast Food Minimum Wage FAQ.

Local Minimum Wage Ordinances

Forty California cities have adopted their own ordinances requiring payment of a higher local minimum wage to employees who work in those cities as little as 2 hours per week.  Most ordinances increase the minimum wage each January 1, while a select few increase each July 1.  January 1, 2026 increases have not yet been announced.  To find out if a city where your employees work have adopted a local minimum wage ordinance, contact an SMT employment law attorney or check your city website.  Watch for future SMT Employment Law Bulletins for announcements as we get closer to January 2026.

California’s employee pay requirements can be confusing.  Please contact an SMT Employment Attorney if you have questions.

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SMT employment attorneys can provide your company with employment policies, forms and employee disciplinary documentation in Spanish. Providing such important information to employees in the language they understand is critical to employee performance, providing a welcoming diverse work environment, and protecting your company against employment claims. Contact an SMT attorney today to get started.

Spaulding McCullough & Tansil LLP
Employment Law Group