California Minimum Wage 2025

The United States has a federal minimum wage. In addition, most states have a minimum wage that employers must follow. The federal minimum wage is $7.25 an hour.

States can set their own minimum wages, which can differ from state to state. If you live in California, you need to know about the state’s minimum wage. Here’s what you need to know about the California minimum wage.

How Has the Minimum Wage Changed in California?

California’s minimum wage has increased numerous times in the past 20 years. In 1998, it was $4.25 per hour. But by 2006, it had risen to $6.75 per hour. In 2022, the state’s minimum wage increased to $15 per hour for companies with more than 25 employees and $13.50 for smaller businesses.

As of January 1, 2025, California’s minimum wage is now $16.50 an hour.

The state minimum wage is higher than in other parts of the country because California has a strong economy with high demand for labor and higher living costs. This means that even jobs that do not pay a lot can still support a family.

California Minimum Wage

California Governor Jerry Brown increased the state’s minimum wage to $10 an hour as of July 1, 2017. This follows a series of incremental increases over the last few years, which saw California’s minimum wage rise to $16.50 in 2025. Effective January 1, 2017, California will increase the minimum wage for all industries on a yearly basis.

The increase in labor costs for businesses is likely to be costly and frustrating. Employers in California need to be aware of the financial implications this change may have on their business to prepare themselves for the increase in local wages accordingly.

How should small business owners prepare for minimum wage increases?

California small business owners should be prepared for yearly increases in the minimum wage. This includes knowing how much is changing and when it will happen. You will need to prepare your small business now.

Small business owners should consider budgeting for the increased labor cost to prepare. Additionally, it would be best if you thought about what your staff will need to do when the wages increase. You may have to retrain them or hire new employees altogether. It's all about getting ready for these changes now, so you know how they will affect your small business in the future.

Minimum Wage in California by City

In addition to a state minimum wage, many California cities have their own minimum wage rates that are in excess of the state’s minimum wage.

2025 Minimum Wage Updates

What can I do if my employer does not pay me at least minimum wage?

If an employer pays the worker less than the state's minimum wage rate, they are in violation of California minimum wage law. If this happens to you, call the attorneys at Freeburg & Granieri, APC today for further guidance.

You can also report the improper payment of wages to the California Labor Commissioner. You may file a complaint with their office. The Labor Commissioner will investigate your complaint and determine if the employer has violated minimum wage laws.

If you're not being compensated for all hours worked and overtime, you can contact private attorneys even if you don't make California's legal minimum wage. They will assess your situation and help you capture what's rightfully owed to you by your employer.

Final Thoughts

As of January 1, 2025, California employers are now required to pay $16.50 an hour to their employees.

When it comes to state law and local minimum wage laws, employers should comply with both rates. Where the rate is higher in a given city than within their state, employers need to comply with that specific wage. Employers then have a responsibility to review compensation for exempt employees working as doctors or teachers to ensure they meet salary threshold requirements.