EMPLOYMENT LAW NEWS
California Minimum Wage in 2025
By Dana Holle, GovDocs Counsel & Team Lead Employment Law and Compliance
Updated June 2025
Employers that operate in California must monitor the ever-changing minimum wage rates in local jurisdictions which will grow more challenging as the jurisdictions change from regularly scheduled increases to indexing increases.
California became the first state to reach a $15 standard minimum wage for large employers in 2022, and it continues to increase each year based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
In addition to the standard minimum wage, employers in California must also comply with numerous local minimum wage ordinances and industry-specific wage rates, when applicable.
Below is a current breakdown of minimum wage rates in The Golden State.
California Hourly Employees Minimum Wage:
Effective Jan. 1, 2025, California announced its minimum wage increase to $16.50 per hour.
California prohibits employers from taking a tipped credit, so there is no separate rate for tipped workers.
View our latest blog for 2025 minimum wage rates by state.
Exempt Employees:
On January 1, 2025, the minimum salary for exempt employees in California increased to $68,640 annually, or $5,720 monthly. Computer software employees are exempt if paid $56.97 per hour, $9,888.13 monthly, or $118,657.43 annually.
California Fast Food Employees:
Since April 1, 2024, minimum wage for certain fast food employees in California, as per AB 1228 and AB 610, is $20.00 per hour.
California’s Fast Food Council is currently assessing whether to mandate an additional increase of 70 cents to the fast food worker minimum wage in the upcoming months. At this time, it remains at $20 in 2025. Learn More About California’s Fast Food Minimum Wage Law
California Health Care Minimum Wage Employees:
As of Oct. 16, 2024, the minimum wage for certain covered health care employees in California under SB-525, increased. There are several minimum wage rates updates for July 1, 2025, that may apply depending on the type of health care facility, which are as follows:
| Type of Healthcare Facility | MW – July 1, 2025 |
|---|---|
| Hospital or integrated health system with 10,000 or more full-time employees (including skilled nursing facilities operated by these employers) | $24 |
| Dialysis Clinics | $24 |
| Safety Net Hospitals | $18 + 3.5% increase |
| Intermittent clinics, community clinics, rural health clinics, or urgent care clinics associated with community or rural health clinics | Remains at $21 |
| All other covered health care facilities not listed in the other categories and not run by Counties | Remains at $21 |
| Covered Health Care Facilities run by Large Counties (more than five million people as of 1/1/23) | $24 |
| Covered Health Care Facilities run by Medium Sized Counties (250,000 to five million people as of 1/1/23) | Remains at $21 |
| Covered Health Care Facilities run by Small Counties (less than 250,000 people as of 1/1/23) | $18 + 3.5% increase |
Keep Informed
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California City Minimum Wage Rates in 2025:
California’s numerous local minimum wage rates across the state make it one of the most complex states to track in the United States.
California has over 40 local jurisdictions with their own minimum wage ordinances. And all but one have moved to indexed rate increases, meaning they increase based on the applicable Consumer Price Index (CPI) instead of a set schedule.
It should be noted again that the state does not allow employers to take tip credits, so there are no separate rates for employees who regularly receive tips. And some cities have separate rates for hotel workers.
California City & County Minimum Wage Rate Updates on July 1, 2025:
Cities and counties with their own minimum wage rates in California update on either Jan. 1 and/or July 1.
Below is a rundown of the local rates that update on July 1, 2025.
Please note: the below chart only includes rates for large employers.
Lastly, please note that your locations may be required to pay a different wage, depending on factors such as:
- Industry/sub-industry
- Tipped wages
- Small-employer wages
- Number of employees
- Minimum/maximum company revenue
- Student/learner wages
- New employee wages
- Overtime
- Whether the employer provides health benefits
This Employment Law News blog is intended for market awareness only, it is not to be used for legal advice or counsel.
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