Minimum Wage Updates in California for 2026
The State of California and many local jurisdictions will be implementing new minimum wage increases in the new year. Employers across the state should carefully review or monitor (1) the California statewide minimum wage rate, (2) statewide industry specific minimum wage rates, and (3) any local minimum wage rates applicable to jurisdictions where their employees work. Employers must ensure that necessary adjustments to their payroll are in effect for any services performed on or after January 1, 2026.
It is also important to remember that the California statewide minimum wage rate and industry specific minimum wage rates effect thresholds for overtime exemptions applicable to qualifying administrative, executive, and professional employees. The new thresholds for overtime exemptions will also take effect on January 1, 2026.
CALIFORNIA MINIMUM WAGE
Starting January 1, 2026, California’s statewide minimum wage will increase to $16.90 per hour for all employers, regardless of size.
Any employer with employees earning minimum wage must post the statewide Minimum Wage Order in an area accessible to employees. Copies can be downloaded here.
INDUSTRY SPECIFIC MINIMUM WAGE
FAST FOOD EMPLOYEES
The Fast Food Council, which is responsible for adjusting the fast food minimum wage, has yet to announce an increase for 2026; the fast food employee minimum wage stands at $20.00 per hour.
HEALTHCARE EMPLOYEES
On July 1, 2026, minimum wage for employees of covered healthcare facilities will change, as follows:
-Hospital or integrated health system with 10,000 or more full-time employees (including skilled nursing facilities operated by these employers): from $24 to $25
-Dialysis Clinics: from $24 to $25
-Safety Net Hospitals: from $18.63 to $19.28
-Intermittent clinics, community clinics, rural health clinics, or urgent care clinics associated with community or rural health clinics: from $21 to $22
-All other covered health care facilities not listed in the other categories and not run by Counties: from $21 to $23
-Covered Health Care Facilities run by Large Counties (more than five million people as of 1/1/23): from $24 to $25
-Covered Health Care Facilities run by Medium Sized Counties (250,000 to five million people as of 1/1/23): from $21 to $23
-Covered Health Care Facilities run by Small Counties (less than 250,000 people as of 1/1/23): from $18.63 to $19.28
LOCAL MINIMUM WAGE RATES
State and federal law allow municipalities to set even higher minimum wage rates for employees who perform services in their jurisdictions. Below is a breakdown of current local minimum wage rates:
Locality: Effective: Rate: Small Employer Rate: Links:
Alameda 7/1/2025 $17.46 webpage
Belmont 1/1/2026 $18.95 webpage
Berkeley 7/1/2025 $19.18 webpage
Burlingame 1/1/2026 $17.86 webpage
Cupertino 1/1/2026 $18.70 webpage
Daly City 1/1/2026 $17.50 webpage
East Palo Alto 1/1/2026 $17.90 website
El Cerrito 1/1/2026 $18.82 webpage
Emeryville 7/1/2025 $19.90 webpage
Foster City 1/1/2026 $17.85 webpage
Fremont 7/1/2025 $17.75 webpage
Half Moon Bay 1/1/2026 $17.91 webpage
Hayward 1/1/2026 $17.79 $16.90 webpage
Los Altos 1/1/2026 $18.70 webpage
Los Angeles 7/1/2025 $17.87 webpage
Los Angeles 7/1/2025 $17.81 webpage
County (unincorporated)
Malibu 7/1/2024 $17.27 webpage
Menlo Park 1/1/2026 $17.55 webpage
Milpitas 7/1/2025 $18.20 webpage
Mountain View 1/1/2026 $19.70 webpage
Novato 1/1/2026 $17.46 $16.90 webpage
Oakland 1/1/2026 TBA webpage
Palo Alto 1/1/2026 $18.70 webpage
Pasadena 7/1/2025 $18.04 webpage
Petaluma 1/1/2026 $18.31 webpage
Redwood City 1/1/2026 $18.65 webpage
Richmond 1/1/2026 $19.18 webpage
San Carlos 1/1/2026 $17.75 webpage
San Diego 1/1/2026 $17.75 webpage
San Francisco 7/1/2025 $19.18 webpage
San Jose 1/1/2026 $18.45 webpage
San Mateo 1/1/2026 $18.60 webpage
San Mateo 1/1/2026 $17.95 webpage
County (unincorporated)
Santa Clara 1/1/2026 $18.70 webpage
Santa Monica 7/1/2025 $17.81 webpage
Santa Rosa 1/1/2026 $18.21 webpage
Sonoma 1/1/2026 $18.47 $17.38 webpage
South San Francisco 1/1/2026 $18.15 webpage
Sunnyvale 1/1/2026 $19.50 webpage
West Hollywood 1/1/2026 $20.25 webpage
As a reminder, employers with remote workers should pay attention to where such employees are located. Remote employees could be subject to local minimum wage and other ordinances that would not apply to employees who report to the employer’s physical premises. For transient workers, most local minimum wage ordinances apply when an employee works two or more hours in the jurisdiction during a week. Remember that the applicability of local ordinances is generally based on where an employee works, rather than where the physical worksite is located.
THRESHOLDS FOR OVERTIME EXEMPTIONS
Like the minimum wage, there are both statewide and industry specific thresholds for overtime exemptions. The statewide minimum wage and in some cases the California Consumer Price Index—not local minimum wage rates—are used to determine thresholds for overtime exemptions.
STATEWIDE SALARY THRESHOLD FOR OVERTIME EXEMPTION
As of January 1, 2026, the minimum salary requirement for employees to be exempted from overtime requirements will be $70,304 annually.
INDUSTRY SPECIFIC THRESHOLDS FOR OVERTIME EXEMPTION
As of January 1, 2026, the threshold for qualified computer professionals to be exempted from overtime requirements will be:
- $58.85 per hour
- $10,214.44 per month
- $122,573.13 per year
As January 1, 2026, the salary threshold for qualified fast food employees to be exempt from overtime requirements will be:
- $1,600 per week
- $83,200 per year
As of January 1, 2026, qualified healthcare employees—excluding licensed physicians— will have to earn 1.5 times the applicable healthcare employee minimum wage or two times the statewide minimum wage, whichever is greater, to be exempt from overtime requirements.
As of January 1, 2026, qualified licensed physicians and surgeons will have to earn an hourly rate of pay greater than $107.17 per hour to be exempt from overtime requirements.
PENALTIES FOR NON-COMPLIANCE
Failure to meet these requirements may result in fines, penalties, or civil action. In addition, under California law, failure to pay minimum wage or applicable overtime pay is a crime (i.e., a misdemeanor).
ACTION STEPS FOR EMPLOYERS
All businesses, and particularly those operating in effected industries or any of the listed jurisdictions, should ensure compliance by:
- Updating payroll systems to reflect new minimum wage rates.
- Displaying updated notice posters in conspicuous locations.
- Providing physical copies of notices to remote employees.
- Reviewing and adjusting exempt employee salaries to reflect the new minimum.
As always, if you have any questions about the matters discussed in this issue of Compliance Matters, please call your firm contact at (818) 508-3700 or visit us online at www.brgslaw.com .
Sincerely,
George MacDonald