California’s minimum wage is $16.90 per hour as of January 1, 2026, and it applies to every employer in the state regardless of size.1California Department of Industrial Relations. Minimum Wage That figure is the floor. Fast food workers, healthcare workers, and employees in dozens of cities with their own ordinances are entitled to more, and the rules on overtime, tips, and worker classification often decide what a paycheck actually looks like.
How the Statewide Rate Changes Each Year
California adjusts its minimum wage automatically through a formula tied to inflation. The Director of Finance compares the U.S. Consumer Price Index for Urban Wage Earners and Clerical Workers across two July-to-June periods. If prices rose, the wage increases by the lesser of 3.5 percent or actual inflation, rounded to the nearest ten cents. The new rate is finalized by August 1 and takes effect the following January 1.2California Legislative Information. California Labor Code LAB 1182.12 If inflation is negative, the rate holds flat; it never drops.
Fast Food Workers Earn At Least $20.00
Fast food employees earn a minimum of $20.00 per hour under AB 1228, which took effect April 1, 2024.3Department of Industrial Relations. Fast Food Council The law covers workers at limited-service restaurants that belong to chains with at least 60 locations nationwide. A limited-service restaurant is one where customers order and pay before eating, so traditional sit-down restaurants with full table service fall outside the rule.4California Department of Industrial Relations. Fast Food Minimum Wage Frequently Asked Questions The Fast Food Council created by the same law can recommend further increases of up to 3.5 percent annually.
Healthcare Workers Follow a Separate Schedule
Senate Bill 525 established a phased wage schedule for healthcare workers that varies by facility type. The increases began October 16, 2024.5California Department of Industrial Relations. Health Care Worker Minimum Wage Frequently Asked Questions For 2026, the relevant rates are:
- Large health systems with 10,000 or more employees and dialysis clinics: $24.00 through June 30, 2026, then $25.00 on July 1.
- Facilities in counties over 5 million people: $24.00 through June 30, 2026, then $25.00.
- Medium-county facilities (250,000 to 5 million people) and other covered non-county facilities: $21.00 through June 30, 2026, then $23.00.
- Community clinics, rural health clinics, and related urgent care clinics: $21.00 through June 30, 2026, then $22.00.
- Safety net hospitals and small-county facilities: $18.63 through June 30, 2026, then $19.28.
The definition of “healthcare worker” is broader than most people expect. It covers nurses and clinical staff, and also janitorial, food service, laundry, security, billing, call center, and gift shop employees at covered facilities.5California Department of Industrial Relations. Health Care Worker Minimum Wage Frequently Asked Questions If you work inside a covered facility in almost any role, the healthcare rate likely applies.
City and County Rates Can Be Higher
Dozens of California cities and counties set their own minimum wages above the state floor. Local rates for 2026 range from just above $16.90 in some smaller cities to over $20.00 in West Hollywood. Several Bay Area cities cluster between $18.00 and $19.70, including Mountain View, Sunnyvale, San Jose, Berkeley, and Emeryville. Los Angeles and San Diego both set their own rates above the state figure.
Many local ordinances update on July 1 rather than January 1, so two adjustment calendars run in parallel. Local wage laws generally apply to anyone performing work within the city’s geographic boundaries, even when the employer is headquartered elsewhere. Employers must post the applicable local notice alongside the state poster.
Overtime at the Minimum Wage
California’s overtime rules are more generous than federal law, and that gap matters most at the bottom of the pay scale. Overtime is calculated by the day as well as the week:6California Department of Industrial Relations. Overtime
- More than 8 hours in a day, up to 12: 1.5 times your regular rate.
- More than 12 hours in a day: double your regular rate.
- Seventh consecutive day in a workweek: 1.5 times for the first 8 hours, double time after that.
At $16.90, time-and-a-half is $25.35 per hour and double time is $33.80. An employer cannot ask you to waive overtime, and any agreement to accept a lower rate is unenforceable. In cities with higher local minimums, overtime is calculated off the higher rate.
Who Is Exempt From the Minimum Wage
Executive, Administrative, and Professional Employees
White-collar employees can be exempt from both minimum wage and overtime, but only if they pass two tests. First, they must earn a fixed monthly salary of at least twice the state minimum wage for full-time work. For 2026, that threshold is $70,304 per year.7California Department of Industrial Relations. California’s Minimum Wage Set to Increase to $16.90 Per Hour on January 1, 2026 Second, their primary duties must involve managing a department, exercising independent judgment on significant business matters, or performing specialized work requiring advanced knowledge.8California Legislative Information. California Labor Code LAB 515 “Primary” means more than half of working time. Fail either test and the employee is non-exempt.
Outside Salespersons
Workers who spend more than half their working time away from the employer’s premises making sales or taking orders are exempt. The test looks at actual hours, not job titles. Time spent in an office on paperwork or meetings counts against exempt status.
Learners
During the first 160 hours in a new occupation where they have no related prior experience, learners may be paid 85 percent of the minimum wage. At the 2026 rate that works out to $14.37 per hour. Registered apprentices follow separate pay schedules through the Division of Apprenticeship Standards.
Employee or Independent Contractor
Whether you’re entitled to the minimum wage at all turns on whether you’re an employee or an independent contractor. California applies the ABC test under Labor Code Section 2775. A worker is presumed to be an employee unless the hiring business proves all three of the following:9California Legislative Information. California Labor Code LAB 2775
- A — The worker is free from the hiring entity’s control over how the work is done, in contract and in practice.
- B — The work falls outside the hiring entity’s usual course of business.
- C — The worker is engaged in an independently established trade or business of the same type.
All three must be met. Failing even one makes the worker an employee entitled to minimum wage and overtime. Certain licensed professionals, including doctors, lawyers, architects, accountants, and real estate agents, are evaluated under the older Borello test instead.10Franchise Tax Board. Worker Classification and AB 5 Frequently Asked Questions Willful misclassification carries civil penalties of $5,000 to $15,000 per violation, rising to $10,000 to $25,000 when part of a pattern.11California Legislative Information. California Labor Code LAB 226.8
Tips, Meals, and Lodging
California does not allow a tip credit. Every employee must receive the full $16.90 per hour (or the applicable higher rate) directly from the employer, and tips are paid on top. Employers cannot deduct credit card processing fees from tips paid by card, and gratuities belong entirely to the employee they were left for.12California Legislative Information. California Labor Code LAB 351
Employers can credit the cost of meals or lodging against the minimum wage, but only under a voluntary written agreement signed by the employee, and only up to capped amounts. For 2026, the limits are:13California Department of Industrial Relations. California Minimum Wage MW-2026
- Room occupied alone: $79.46 per week.
- Shared room: $65.59 per week.
- Apartment: two-thirds of ordinary rental value, capped at $954.43 per month.
- Breakfast: $6.10. Lunch: $8.42. Dinner: $11.28.
The private-room credit works out to roughly $345 per month, which is a fraction of real housing costs in most of California. The caps exist to stop employers from clawing back the minimum wage through inflated room-and-board charges.
Split Shifts and Reporting Time
If your employer schedules you for a split shift, meaning your workday is broken up by a stretch of unpaid non-working time longer than a meal break, you’re owed a premium equal to one hour of pay at the applicable minimum wage. Any amount you already earn above that minimum on the same day is credited against the premium, so higher-paid workers may not see an additional payment. A break you request yourself does not count as a split shift.14Department of Industrial Relations. Split Shift
When you report for a scheduled shift and the employer sends you home early or gives you less than half your usual hours, you’re entitled to reporting time pay: half the scheduled hours, with a minimum of two hours and a maximum of four at your regular rate. A second call-back the same day with less than two hours of work triggers another two hours of pay.15Department of Industrial Relations. Reporting Time Pay Natural disasters, utility failures, and similar events outside the employer’s control are exceptions.
Penalties and How to File a Claim
California stacks penalties on top of each other when an employer underpays. A worker can recover the unpaid wages themselves, plus liquidated damages equal to those wages (reducible only if the employer proves a good-faith mistake), plus civil penalties of $100 per employee per pay period for a first intentional violation and $250 per employee per pay period for later ones.16California Legislative Information. California Labor Code LAB 1197.1 When an employer fails to pay all wages owed at separation, waiting time penalties add one day’s pay for every day the wages remain unpaid, up to 30 calendar days, and inability to pay is not a defense.17California Department of Industrial Relations. Waiting Time Penalty
If you believe you’ve been underpaid, file a wage claim with the Labor Commissioner’s Office. The office investigates, typically schedules a settlement conference, and if that fails, sends the case to a Berman hearing where a hearing officer takes evidence and issues a decision.18Department of Industrial Relations. How to File a Wage Claim Either side can appeal within 10 days.
Deadlines matter. Minimum wage, overtime, and illegal deduction claims must be filed within three years of the violation. Claims based on an oral promise to pay above minimum wage have a two-year deadline, and claims based on a written contract have four.19Department of Industrial Relations (DIR). Recover Your Unpaid Wages With the Labor Commissioner’s Office Workers also have the option of pursuing civil penalties under the Private Attorneys General Act, which requires written notice to the employer and the Labor and Workforce Development Agency before filing suit.20Department of Industrial Relations. Private Attorneys General Act (PAGA) – Filing