California: Minimum wage rises to $17.40 on January 1, 2027; exempt floor to $72,384
California's statewide minimum wage increases from $16.90 to $17.40 on January 1, 2027, for employers of all sizes.
Status: Action before Jan 1
Jurisdiction: California · Topic: Minimum wage
Source: California DIR, August 13, 2026
What changed
California’s statewide minimum wage increases from $16.90 to $17.40 on January 1, 2027, for employers of all sizes.
The increase also raises the standard exempt salary threshold to $72,384 annually.
What to do
Identify exempt California employees below the new threshold now so you have time to decide whether to increase compensation or reclassify the position.
Primary source: California DIR, August 13, 2026. Part of Compliance Watch, Issue 01 (September 11, 2026). Last reviewed September 11, 2026.
Questions employers ask
When does this take effect?
Where is the official source?
What should employers do now?
Questions about this update?
Every “What to do” line above is a task for someone at your company. Our clients hand the payroll and tax pieces to us and get an HR advisor for the rest.
Get help with California rules All 12 updates in Issue 01
General information from VertiSource HR, not legal or tax advice. How a rule applies depends on your company and your state. Check with us or your attorney before acting.
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