Mid-Year Industry and Locality Minimum Wage Increases for Nonexempt Employees Effective July 1, 2025

California’s state-wide minimum wage for employees who are not otherwise covered by a higher industry (e.g., healthcare and fast food industries) or locality (e.g., municipalities) minimum wage most recently increased to $16.50 per hour effective January 1, 2025. The next state-wide adjustment will take place on January 1, 2026, and will be based on the consumer price index for urban wage earners and clerical workers (CPI-W).  Any adjustment, to be announced shortly, will not result in a reduced minimum wage, even if there is a negative CPI, and the largest increase allowed in any one year is 3.5%.

Higher minimum wages apply to certain employees, including increased minimum wages for certain healthcare workers and fast food workers. Notably, the minimum hourly rate for covered healthcare workers increases again effective July 1, 2025, to $24.00 per hour.

Several localities will also be increasing their rates effective July 1, 2025, which will increase the minimum hourly rate for nonexempt employees in those locations above California’s state-wide minimum wage requirement. This includes, but is not limited to, increases to the minimum wage in Alameda, Berkeley, Emeryville, Fremont, Los Angeles (city and county), Milpitas, Pasadena, San Francisco, and Santa Monica. A complete list of locality minimum wages, including information about the dates of the most-recent changes, can be found here.

Where an employer operates in a location or employs individuals in an industry where there are multiple applicable minimum wages, the employer must follow the stricter standard applicable to each employee, i.e., the one that is most beneficial to the employee.

The California Labor Commissioner maintains a Minimum Wage Frequently Asked Questions page for more information regarding California minimum wages.

This legal update and any use of its information does not create an attorney-client relationship. Nothing contained on this website should be considered legal advice for any specific employer or employment situation. Consult legal counsel before taking any action as a result of information contained herein.