EMPLOYMENT LAW NEWS

California Minimum Wage in 2027

Dana HolleBy Dana Holle, GovDocs Counsel and Manager Employment Law and Compliance

Updated September 2026

Starting Jan. 1, 2027, California’s minimum wage increases to $17.40 per hour, with exempt employees earning at least $72,384 annually. Fast food workers remain at $20 per hour, and health care rates range from $19.28 to $25, depending on facility type and location.

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). For the first time, California’s minimum wage will rise above $17.

In addition to the standard minimum wage, employers in California must also comply with local minimum wage ordinances and industry-specific wage rates, when applicable. 

Below is a current breakdown of state-level minimum wage rates in The Golden State. 

California Announces Minimum Wage Increase for 2027

Effective Jan. 1, 2027, California’s minimum wage increases to $17.40 per hour. 

Since the state minimum wage reached $15.50 on Jan. 1, 2023, California’s labor code requires the Director of Finance to announce an adjusted state-level minimum wage on or before Aug. 1 to take effect each January thereafter. 

Right on schedule, Director of Finance Joe Stephenshaw published the annual Minimum Wage Increase Certification on July 31 indicating, “This year, the Department of Finance calculates the average U.S. CPI-W for the 12-month period from July 1, 2025 to June 30, 2026 increased by 2.99 percent compared to the 12-month period from July 1, 2024 to June 30, 2025.” As a result, the minimum wage was adjusted by 2.99%, and rounded to the nearest 10 cents, to $17.40. 

California prohibits employers from taking a tipped credit, so there is no separate rate for tipped workers. 

California Exempt Employees

On Jan. 1, 2027, the minimum salary for exempt employees in California increases to $72,384 annually. Computer software employees can also be exempt; however, California has not yet announced its 2027 thresholds. 

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California Fast Food Employees

Since April 1, 2024, the minimum wage for certain fast food restaurant employees in California, as per AB 1228 and AB 610, has been $20 per hour. To be considered a fast food restaurant, the following criteria must all be met:  

  • Must be a “limited-service restaurant” in California (i.e., limited or no table service, where customers order and pay before eating). 
  • Must be part of a chain with at least 60 establishments nationwide. Off-site locations for administrative, warehouse, or prep tasks do not count toward 60. 
  • Must be primarily engaged in selling food and beverages for immediate consumption. 

California also established a Fast Food Council that is supposed to meet and discuss future wage increases and standards; however, it has not met in over two years. Currently, the fast food minimum wage remains at $20 with no additional scheduled increases for 2027. 

California Health Care Employees 

Under SB-525, the minimum wage for certain covered health care employees in California has increased periodically since Oct. 16, 2024. While there are no updates for Jan. 1, 2027, there were several healthcare facilities that updated rates on July 1, 2026. Below are the current health care minimum wage rates: 

  • Hospital or integrated health system with 10,000 or more full-time employees (including skilled nursing facilities operated by these employers) – $25.00 
  • Dialysis Clinics – $25.00 
  • Safety Net Hospitals – $19.28 
  • Intermittent clinics, community clinics, rural health clinics, or urgent care clinics associated with community or rural health clinics – remains at $22.00 
  • All other covered health care facilities not listed in the other categories and not run by counties – $23.00 
  • Covered Health Care Facilities run by Large Counties (more than five million people as of 1/1/23) – $25.00 
  • Covered Health Care Facilities run by Medium Counties (250,000 to five million people as of 1/1/23) – $23.00 
  • Covered Health Care Facilities run by Small Counties (less than 250,000 people as of 1/1/23) – $19.28 
  • Skilled nursing facilities not owned, operated, or controlled by a hospital, integrated health care delivery system, or health care system – $23.00 

A few of these healthcare facility types will see their next increase on July 1, 2027. 

California Minimum Wage Orders

California has a hefty list of minimum wage orders that must be displayed depending on the industry and/or occupation:

  • Wage Order #1 – Manufacturing Industry 
  • Wage Order #2 – Personal Services Industry 
  • Wage Order #3 – Canning, Freezing, and Preserving Industry 
  • Wage Order #4 – Professional, Technical, Clerical, Mechanical and Similar Occupations 
  • Wage Order #5 – Public Housekeeping Industry 
  • Wage Order #6 – Laundry, Linen Supply, Dry Cleaning and Dyeing Industry 
  • Wage Order #7 – Mercantile Industry 
  • Wage Order #8 – Industries Handling Products After Harvest 
  • Wage Order #9 – Transportation Industry 
  • Wage Order #10 – Amusement and Recreation Industry 
  • Wage Order #11 – Broadcasting Industry 
  • Wage Order #12 – Motion Picture Industry 
  • Wage Order #13 – Industries Preparing Agricultural Products for Market, on the Farm 
  • Wage Order #14 – Agricultural Occupations 
  • Wage Order #15 – Household Occupation 
  • Wage Order #16 – Certain On-Site Occupations in the Construction, Drilling, Logging and Mining Industries 
  • Wage Order #17 – Miscellaneous Employees 

There is also a general minimum wage order that lists upcoming, current, and past wage rates released each year. It should be posted next to the industry-specific wage order.  

Employers must also display a fast food minimum wage supplement or health care minimum wage supplement at the workplace, when applicable.  

While California has not released updated minimum wage orders for next year, GovDocs is monitoring for their release and will ship updated posters and wage orders to GovDocs Standard Update Service customers who have impacted locations.  

Look Out for More California Minimum Wage Updates

In addition to the new California minimum wage, employers should also be prepared for a significant number of local minimum wage updates in the state taking effect at the start of the year. Over 30 jurisdictions will update their city or county minimum wage on Jan. 1, 2027, including San Francisco, San Mateo County Unincorporated, San Diego, and San Jose. Notably, all 30 of these local jurisdictions also have corresponding minimum wage postings that are part of GovDocs Standard Update Service and in the digital Intranet Poster Program. 

Navigating Minimum Wage in California

Having trouble tracking city, county, and state minimum wage updates in California or elsewhere?  Check out GovDocs Minimum Wage, which provides a robust online solution that simplifies minimum wage rate management for multi-state employers. Our products are developed by industry experts and trusted by over 34% of the Fortune 500. 

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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