California Minimum Wage in 2024

The federal minimum wage in the United States has remained unchanged at $7.25 per hour since 2009, creating a significant disparity as many states, including California, have raised their minimum wage annually in recent years. California, in particular, began implementing steady minimum wage increases in 2017, and this trend has influenced around 20 other states nationwide, many of which have enacted similar legislation or responded to voter initiatives aimed at increasing local wages.

Why Hasn’t the Federal Minimum Wage Increased?

One common question is why the federal minimum wage has not seen any adjustments since 2009. While inflation, cost of living, and economic demands have increased, the federal wage remains stagnant. This gap has encouraged individual states and cities to take action to better meet their residents’ needs. Local and state-led initiatives are often passed either through legislation or by a direct vote from residents seeking a living wage. For more on this, ABC7’s report covers state-level minimum wage changes and the impact on workers’ livelihoods.

California’s Role in Raising Minimum Wages

California has taken one of the most progressive stances on this issue, with gradual yearly increases that are now influencing other states. By setting an example, California has shown that incremental wage growth can be achieved through strategic legislation. As NBC LA reports, California’s minimum wage increases aim to help meet the higher cost of living faced by workers in metropolitan areas like Los Angeles and San Francisco, which often far exceeds the federal baseline.

What Other States Are Following Suit?

Approximately 20 states across the U.S. have now adopted similar minimum wage increases, either through state laws or voter-approved measures. These states include Washington, Massachusetts, and New York, where advocates have successfully lobbied for more substantial wages. Some of these increases are indexed to inflation, meaning they will automatically adjust each year to reflect changes in the cost of living.

How Do Local Minimum Wage Increases Affect Small Businesses?

Local minimum wage increases can have both positive and challenging effects on small businesses. While higher wages support worker retention and can boost local economies, they can also impose additional financial strain on small businesses. Fox11 provides insights into how local minimum wage adjustments impact small business operations, workforce dynamics, and consumer spending.

As the debate around minimum wage continues, it’s clear that state-led efforts play a crucial role in shaping wage policies across the country. By setting new standards, states like California are not only helping to raise the income floor but also providing a model for other regions to follow.

California Minimum Wage Laws in 2024: What You Need to Know

As of January 1, 2024, California has raised its minimum wage to $16.00 per hour for all employees, regardless of the employer’s size. This uniform rate applies to both small businesses and larger corporations, underscoring California’s commitment to fair pay and financial security for its workforce. The new minimum wage law is part of the state’s ongoing effort to ensure wages keep pace with economic changes, the rising cost of living, and inflation.

Why Did California Raise the Minimum Wage?

California’s minimum wage increase comes in response to economic pressures and rising living costs across the state. In recent years, California has seen a surge in housing costs, healthcare expenses, and overall living expenses. By setting a consistent rate of $16.00 per hour, California aims to mitigate these challenges, helping workers keep up with basic necessities. For more details on how minimum wage adjustments affect Californians, check out this article from ABC7.

Who Does the New Minimum Wage Affect?

Under the 2024 law, all hourly workers in California, regardless of the employer’s size or business type, are entitled to at least $16.00 per hour. This includes employees in service industries, such as restaurants and retail, where wages have historically been lower than in other sectors. The equal rate also ensures smaller businesses align with larger corporations, which previously had different wage requirements under earlier legislation.

Q: What about employees who earn tips?

A: In California, tips cannot count toward meeting the minimum wage requirement, so all tipped employees are still guaranteed a minimum of $16.00 per hour in base pay.

The Economic Impact of Minimum Wage Increases

Research shows that increasing the minimum wage positively impacts low-income workers and reduces poverty rates. A 2021 study found that states with higher minimum wages experience reduced reliance on public assistance programs, such as food stamps. Learn more about similar studies and statistics on NBC LA.

In California, economists anticipate that the minimum wage increase will benefit local economies by increasing workers’ purchasing power. However, some business owners are concerned about potential financial strain, particularly in areas with high operating costs. For a closer look at how California businesses are handling the increase, Fox11 offers a detailed analysis.

Minimum Wage Trends and Future Adjustments

California has been a pioneer in adjusting minimum wage laws to reflect economic conditions and inflation trends. Since 2017, the state has steadily increased wages each year, with a focus on ensuring that workers can support themselves and their families. Economists expect California will continue to adjust minimum wage rates annually, keeping them aligned with inflation.

Q: Are there any exceptions to the $16.00 minimum wage?

A: Some exceptions apply, such as specific government-supported employment programs or employees with disabilities in certain sectors. However, these cases are closely regulated.

2024 County-Specific Minimum Wage Laws in California

Different areas of California have an even higher minimum wage for businesses of different sizes. For example, the minimum wage in Los Angeles is up to $16.00/hour, though it’s important to note that some cities and counties in California have set even higher minimum wages based on local ordinances and cost of living considerations. For instance, certain cities within California may have minimum wages as high as $18.00 per hour or more.

County	Minimum Wage as of January 1st, 2024
Belmont	$17.35
Cupertino	$17.75
Daly City	$16.62
El Cerrito	$17.92
Los Altos	$17.75
Menlo Park	$16.70
Mountain View	$18.75
Novato	$16.86 (for businesses with 100+ employees)
	$16.60 (for businesses with 26-99 employees)
Oakland	$15.97
Palo Alto	$17.80
Petaluma	$16.00
	$17.45
Redwood City	$17.70
San Diego	$16.85
San Jose	$17.55
San Mateo	$17.35
Santa Clara	$17.75
Sonoma	$17.60 (for businesses with 26 or more employees)
	$16.56 (for businesses with 1-25 employees)
South San Francisco	$17.25
Sunnyvale	$18.55

County	Minimum Wage as of July 1st, 2024
Alameda	$16.52
Berkeley	$18.07
Emeryville	$18.67
Fremont	$16.00
	$16.80
Los Angeles (City & Unincorporated)	$15.96
	$16.78
Malibu	$16.00
	$16.90
Milpitas	$17.20
Novato	$16.86 (for businesses with 100+ employees)
	$16.60 (for businesses with 26-99 employees)
	$16.00 (1-25 employees)
Pasadena	$16.93(>26 employees)
	$15.00(1-25 employees)
San Francisco	$18.07
San Leandro	$15.50
Santa Monica	$16.90(>26 employees)
	$16.00 (1-25 employees)
Santa Rosa	$17.45(>26 employees)
	$16.00(1-25 employees)

Current Schedule of Statewide Minimum Wage Increases in California by Year

From 2017 to 2024, California has a schedule of when they plan to increase the minimum wages for companies of different sizes. This is what the schedule is currently looking like:

Minimum Wage in California
Year	≤ 25 Employees	> 26 Employees
2017	$10.00/hour	$10.50/hour
2018	$10.50/hour	$11.00/hour
2019	$11.00/hour	$12.00/hour
2020	$12.00/hour	$13.00/hour
2021	$13.00/hour	$14.00/hour
2022	$14.00/hour	$15.00/hour
2023	$15.50/hour	$15.50/hour
2024	$16.00/hour	$16.00/hour

Exceptions to the Minimum Wage Law in California

Not all employees are subject to the minimum wage law, but the salary for exempt employees must be a fixed & guaranteed amount. When it comes to proving that an employee is exempt, the employer is the one who is responsible for providing evidence of this.

Groups that are exempt from this law include parents, spouses, or children of the employer, external sales teams, and indentured apprentices legally allowed under the State Division of Apprenticeship Standards. Under Labor codes 1191 & 1191.5, employees who have a mental or physical disability, or companies that employ disabled workers, a special license must be issued by California’s Division of Labor Standards Enforcement authorizing that an employee can work for less than the state’s minimum wage.

Employees who receive tips are also subject to a different minimum wage that is determined by the state. For example, tipped workers earn only $2.35/hour in New Mexico, $9/hour in Arizona, and $8.98/hour in Colorado.

There is also a specific rule for learners, or those who have no previous work experience of a similar nature, that they must be paid at least 85% of the minimum wage during their first 160 hours of work.

Exempt Employee Requirements in California

For an employee in California to be able to be considered exempt, they must meet specific requirements set by the state. These include:

• An employee must not earn a salary less than twice the state’s minimum wage for full-time employment. As per the current 2024 guidelines, the formula for determining this threshold is 2 times the state’s minimum wage multiplied by 2,080 (the number of hours in a full-time work year). Specifically, California employees on salary in 2024 cannot receive less than $67,040 annually for companies with more than 26 employees and less than $61,760 annually for companies with 26 or fewer employees. This translates to a minimum monthly salary of $5,580 for companies with 26 or fewer workers and a minimum of $6,920 for companies with more than 26 workers.
• If an employee spends over half of their working time performing duties that are considered to be exempt, they can be considered as exempt employees.
• For internal salespeople, they are considered to be exempt as long as they make over 150% of the state’s minimum wage and over 50% of their earnings come from commission. To satisfy this requirement for exemption, an internal salesperson would have to make over $18.00/hour for companies with less than 26 employees and over $19.50/hour for companies with more than 26 employees.

California Minimum Wage Frequently Asked Questions

Can Employees for Less Than the Minimum Wage Willingly?

Without fitting into one of the exception groups, employees cannot work for an employer in the state of California for less than the minimum wage even if they agree to what they’re being paid. This is in accordance with Civil Code Sections 3513 and 1668. Whether the state or federal minimum wage is higher, an employer has to stick to whichever one pays the most. Since many state & city minimum wages are higher than the federally set one, many employees are paid in recognition of the state or city’s law rather than the federal minimum wage.

What Happens When an Employer Pays Less Than the Minimum Wage?

If an employer is not willing to pay their employees the minimum wage required by the law, then the employee(s) can file a wage claim with the Labor Commissioner’s Office, or they can file a lawsuit against the employer to recover lost earnings. When a wage claim is filed, the case is investigated by a local division of the Labor office which will then culminate in a hearing or a dismissal of the claim. The entire process can be appealed by either party, leading to a court trial where both sides can present evidence & witnesses, but the case cannot be decided on the basis of testimony & evidence alone.

If an employer refuses to pay after the court determines that they were in the wrong, then a judgment can be passed by the Division of Labor Standards Enforcement to collect what is owed from them. Furthermore, if an employer chooses to retaliate after an employee files such a suit over lost earnings, a different type of lawsuit based on employer discrimination or retaliation can be filed against the employer. A workplace discrimination lawyer can help you build your case if you believe discrimination was a factor in the retaliation or termination.

Do Tips Count Towards Minimum Wage?

Tips do not count toward the minimum wage and it is illegal for an employer to count tips as part of their obligation to pay an employee’s minimum wage.

Is There Any Difference Between Minimum Wage for Minors or Adults?

Whether an employee is a minor or adult, they are all subject to the same federal and state minimum wage laws unless they fit a specific exception.

Which Other States are Increasing Their Minimum Wage This Year?

Other states in the process of increasing their minimum wage include:

• Alaska
• Arizona
• Arkansas
• Colorado
• Florida
• Illinois
• Maine
• Maryland
• Massachusetts
• Michigan
• Minnesota
• Missouri
• Montana
• New Jersey
• New Mexico
• New York
• Ohio
• South Dakota
• Vermont
• Washington

Contact an Experienced Employment Law Attorney at Heidari Law Group Today

If you’re looking for more information about California’s employment laws such as minimum wage, get in touch with a seasoned employment law attorney who can help guide you in the right direction. Contact us today at 1-833-225-5454 or info@heidarlawgroup.com for a free case evaluation with Heidari Law Group in Los Angeles, Irvine, or Sacramento.

***Disclaimer: This webpage has been crafted by Heidari Law Group solely for educational purposes. The content of this article aims to offer a broad comprehension of the law and does not constitute specific legal advice. By accessing this site and perusing its contents, no attorney-client relationship is established between you and any member of Heidari Law. Additionally, it’s important to note that the legal landscape is subject to continuous change, rendering some of the information provided herein potentially outdated or no longer applicable.