California minimum wage is among the most complex in the U.S.
In 2022, California became the first state to reach a $15 standard minimum wage (for large employers) and its cities continue to pass new wage laws.
Meanwhile, many of those cities have moved to indexed rates, meaning they increase based on the applicable Consumer Price Index (CPI) instead of a set schedule.
Also, employers should note that some jurisdictions’ minimum wage increases changed their schedule in 2022 — yet another reminder of the challenges of tracking and applying rates in California.
Lastly, before getting into the rates for minimum wage in California, at all levels of government, it should be noted that the state does not allow employers to take tip credits, so there are no separate rates for employees who regularly receive tips.
California Minimum Wage: State
At the beginning of 2022, California became the first state with a $15 minimum wage. That rate applies to large employers — those with 26 or more workers — but it reaches $15 for small employers Jan. 1, 2023.
However, in May 2022 state officials announced that California’s minimum wage is projected to increase to $15.50 per hour for all workers on Jan. 1, 2023. The accelerated increase is required through a provision in the law when inflation (under the U.S. CPI) exceeds 7 percent.
The increase, if any, will be known by the end of July 2022.
Minimum Wage Management. Simplified.
California Minimum Wage: Cities
The dozens of cities in California with their own minimum wage rates update at two times of the year:
Below is a rundown of the rates. (Look for an update of this post before the Jan. 1, 2023, minimum wage increases for California cities.) Of course, new employment laws in California are passed all the time, and employers should monitor their locations for potential new minimum wage rates.
Jan. 1, 2022
East Palo Alto
Half Moon Bay
- $15.56 (large employers, 26 or more employees)
- $14.52 (small employers, 25 or fewer employees)
- $15.77 (very large, 100 or more employees)
- $15.53 (large, 26-99 employees)
- $15 (small, 1-25 employees)
- $16.38 (hotel workers with health benefits)
- $21.84 (hotel workers without health benefits)
- $16 (large employers, 26 or more employees)
- $15 (small employers, 25 or fewer employees)
South San Francisco
July 1, 2022
- $17.68 (home to the nation’s highest minimum wage)
- $16.73 (hotel worker)
- $16.55 (concessionaire worker)
- The city otherwise follows the state rate.
- $18.35 (hotel workers)
- $16.50 (large employers, 50 or more employees)
- $16 (small employers, 49 or fewer employees)
- $17.64 (hotel workers)
Los Angeles County
Finally, Los Angeles County also has its own minimum wage rate:
The federal standard minimum wage of $7.25 has not increased in more than a decade. It’s the longest stretch in the nation’s history without a minimum wage bump.
This situation has prompted smaller jurisdictions to pass a flurry of new minimum wage laws over the past few years. And in progressive states like California, minimum wage has become a hot employment law topic.
Employers that operate in California must monitor the ever-changing rates in the state, especially at the local level, which will only grow more challenging as rates move from regular schedules to indexing.