California Minimum Wage Increase 2025: New Rates for State, Fast Food, Healthcare, and Localities

California’s 2025 minimum wage increase sets new statewide, fast food, healthcare, and local rates employers must comply with. Exempt and industry-specific employees face new salary thresholds, impacting wage standards across sectors and jurisdictions.

By Brad Nakase, Attorney

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Table of Contents

1. Introduction

2. Industry-Specific Regulations

3. Increases in the Minimum Wage in Specific Localities

Introduction

In 2025, the minimum wage of California workers is at least $ 16.50 per hour. Till now, it was said that California voters defeated proposal 32, which would gradually increase the minimum wage. With the California minimum wage increase, almost all employees, barring a few exceptions, are now entitled to this base rate.

This California minimum wage increase has implications beyond hourly pay. With this growth, exempt employees, who must get double the minimum wage of the state, will now get at least $ 68,640 per year, or $ 1,320 per week to meet the benchmark requirement.

Wage regulation that applies to their business and the most recent minimum wage order must be posted by employers. The most up-to-date California minimum wage increase information is available through the Department of Industrial Relations (DIR) website. It is available for download and printing through the workplace announcements page.

Industry-Specific Regulations

The California minimum wage increase doesn’t stop at a flat state rate. It is important for employers to pay attention to a rise in the minimum salaries in particular industries, as well as a universal minimum wage raise introduced by the state.

1. Fast Food

As was announced last year, starting on 1^st April 2024, the minimum wage for employees of fast food establishments, which are a group of limited-service restaurants with more than 60 locations nationwide, rose to $20 an hour.

The annual minimum wage of workers in fast food restaurants is set by the Fast Food Council, and it has the authority to raise it by either 3.5 percent or the Consumer Price Index increase, whichever is less.

The Council may also set a minimum wage for the entire state or set different minimum wages for different regions. Although the Council has not yet announced, it is now still exploring additional wage hikes in 2025. To refresh your memory, the law isn’t applicable to bakeries that make bread on-site and sell it as a separate menu item or to restaurants in supermarkets where the employees of the on-site restaurant are hired directly by the supermarket.

2. Healthcare

A new law passed on October 16, 2024, introduced a specific California minimum wage increase for healthcare workers. Additionally, the new law mandates that salaries paid to salaried workers of covered firms must be at least 150 percent of the minimum healthcare pay or 200 percent of the normally applicable minimum salary, whichever is higher.

Originally, the amendment was scheduled to go into effect in June of this year following the passage of Senate legislation 525. However, budgetary issues caused Senate Resolution 159 to postpone implementation. Employees must (1) operate for a “health care facility” that is regulated by the recent legislation and (2) offer healthcare services or assist in the delivery of healthcare in order to be qualified for a minimum salary rise.

The minimum wage hikes per business type are detailed in the Frequently Asked Questions section of the Health Care Worker Minimum Wage on the DIR website. The sole increases that will take effect on 1^st January 2025 are for county-run insured healthcare institutions. The increase is expected to take effect on 1^st July 2025, for other categories of covered companies.

Increases in the Minimum Wage in Specific Localities

Many local jurisdictions have also implemented their own California minimum wage increase rates. Employers also have to take note of and comply with the minimum wage thresholds within the local region should their minimum wage exceed that of the state. If a locality has set a minimum wage that exceeds the state’s minimum wage, the employers should use the higher local wage. Effective 1^st January 2025, the minimum salary rates for specific employees were raised in some localities. Certain localities raised the minimum wage in July 2024 and plan to do so the next time in July 2025.

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