California Minimum Wage 2027: $17.40 Rate and What Changes

Quick answer

The California minimum wage 2027 rate is $17.40 per hour for all employers, effective January 1, 2027, up from $16.90 in 2026. The 2.99% inflation increase also lifts the salary floor for exempt employees to $72,384 a year. Fast food, healthcare and some city workers have separate, higher minimums.

Key takeaways

• California's statewide minimum wage will be $17.40 per hour from January 1, 2027, a 50-cent increase over the 2026 rate of $16.90.

• The California Department of Finance certified the increase on July 31, 2026, based on a 2.99% rise in the Consumer Price Index.

• Exempt (salaried) employees must earn at least $72,384 a year, or $6,032 a month, starting January 1, 2027.

• Fast food workers covered by the state's sector law currently have a separate $20 hourly minimum, and healthcare workers have their own facility-based rates.

• Workers paid below the legal minimum can file a wage claim with the California Labor Commissioner's Office regardless of immigration status.

California minimum wage 2027: what is the new rate?

The California minimum wage 2027 rate is $17.40 per hour, and it applies to all employers in the state. It takes effect on January 1, 2027, replacing the 2026 rate of $16.90.

The California Labor Commissioner's Office (LCO), part of the Department of Industrial Relations (DIR), has reminded both workers and employers to prepare for the change. The rule covers most workers in California, including people paid by the piece rather than by the hour.

Because the rate applies to all employers, a small family business and a large chain must pay the same statewide floor. Where a city or county sets a higher rate, the higher local rate wins.

Why is California's minimum wage going up in 2027?

The increase is automatic and tied to inflation. State law (Labor Code section 1182.12) requires the Director of Finance to decide by August 1 each year whether to adjust the wage, and to apply the smaller of two options:

• a flat 3.5% increase, or

• the actual change in the U.S. Consumer Price Index (CPI) over the most recent 12-month period.

For July 1, 2025, through June 30, 2026, the Department of Finance found that the CPI rose 2.99%. That was below the 3.5% cap, so the wage rises by 2.99%, to $17.40. Finance Director Joe Stephenshaw certified the new rate on July 31, 2026, and Governor Gavin Newsom announced the increase.

How much is $17.40 an hour per week, month and year?

A full-time worker on $17.40 an hour earns about $696 a week before taxes, or roughly $36,192 a year based on 2,080 working hours. These are gross figures; take-home pay will be lower after tax and other deductions.

Here is how the 50-cent raise adds up for someone working 40 hours a week:

• Per hour: $17.40, up from $16.90 (+$0.50)

• Per week (40 hours): $696, up from $676 (+$20)

• Per month (average): about $3,016, up from about $2,929

• Per year (2,080 hours): $36,192, up from $35,152 (+$1,040)

Part-time workers gain in proportion to their hours. Someone working 25 hours a week, for example, would see about $12.50 more per week before deductions.

What is the California exempt salary threshold for 2027?

From January 1, 2027, salaried employees must earn at least $72,384 a year ($6,032 a month) to be treated as exempt from overtime under California's executive, administrative and professional exemptions. That is up from $70,304 a year in 2026.

Like the California minimum wage 2027 rate itself, this threshold moves every year: it is set at twice the state minimum wage for full-time work. DIR shows the calculation as $17.40 x 2 x 40 hours x 52 weeks = $72,384, which works out to $1,392 a week. Three points matter for workers on a salary:

• Salary alone is not enough. Employees must also meet the duties tests for the exemption their employer claims.

• No pro-rating. The salary floor cannot be reduced for part-time exempt roles.

• Local rates do not count. Only the statewide minimum wage sets the exempt salary threshold, even in cities with higher local minimums.

If your salary will fall below $72,384 on January 1 and you are not paid overtime, ask your employer in writing how your role will be classified in 2027.

Who earns more than the $17.40 state minimum?

Several groups of California workers have a legal minimum above $17.40, and the rule is simple: your employer must pay the highest rate that applies to you.

Fast food restaurant workers

Employees covered by California's fast food law (Labor Code sections 1474 to 1476) have a minimum wage of $20 per hour, in place since April 1, 2024. To be classed as exempt, a covered fast food employee must earn twice the fast food minimum wage.

Healthcare workers

Certain healthcare workers have had their own minimum wage schedule since October 16, 2024, with rates that depend on the type of facility. Some of those rates rose on July 1, 2026. Covered healthcare employees classed as exempt must earn the greater of 1.5 times their healthcare rate or twice the state minimum wage.

Workers in cities and counties with local minimums

Many cities and counties, including Los Angeles, San Diego, San Francisco and Emeryville, set local minimum wages above the state rate. The state labor department points workers to a list of local rates maintained by UC Berkeley. Check the rate for the city where you physically do the work, not where your employer is based.

Computer software professionals

Some exempt computer software employees fall under separate hourly and salary rules in Labor Code section 515.5, which are adjusted every year.

What must employers do before January 1, 2027?

Employers must raise pay for affected workers, update their notices and show the correct rate on pay stubs. Based on the Labor Commissioner's reminder and the new salary threshold, the main steps are:

1. Pay every non-exempt employee at least $17.40 an hour, or the higher local or industry rate.

2. Review salaried staff and confirm exempt employees earn at least $72,384 and still meet the duties tests.

3. Post the statewide minimum wage order and the industry wage order for the workplace where staff can see them (DIR offers versions to download and print).

4. List each employee's wage rate on pay stubs.

5. Provide the annual workplace rights notice required under the Workplace Know Your Rights Act, which took effect in 2026.

An employer that underpays staff can owe the missing wages plus penalties and liquidated damages.

What should you do if you are paid less than minimum wage?

Start by documenting the problem and raising it with your employer. If it is not fixed, you can file a wage claim with your local Labor Commissioner's Office.

• Keep records: save pay stubs, schedules and your own notes of the hours you worked.

• Check your first January 2027 paycheck: compare your hourly rate on the stub with $17.40 or your local rate.

• Get help: call the Labor Commissioner's helpline at 833-LCO-INFO (833-526-4636), Monday to Friday from 8 a.m. to 5 p.m., in English or Spanish, or visit wagetheftisacrime.com.

• Know your protections: California labor laws protect workers in most industries regardless of immigration status, and the LCO does not ask about immigration status when you file a claim.

What this means for California job seekers

The California minimum wage 2027 increase is modest, but it resets the baseline for every hourly offer. When you compare job offers for 2027, treat $17.40 as the floor for most roles, the $20 fast food rate (as currently set) for covered fast food jobs, and higher wherever a local minimum applies. If a posting for hourly California work in 2027 offers less than the rate that applies to it, that pay would fall below the legal minimum from January 1. For salaried offers, check that the pay reaches $72,384 if the employer says the job is exempt from overtime.

For a wider view, see our guide to the minimum wage in 2027 by state, along with our coverage of the Washington minimum wage 2027 and the federal contractor minimum wage 2027.

Last updated: October 9, 2026.

Frequently asked questions

What will the minimum wage be in California in 2027?

It will be $17.40 per hour for all employers, starting January 1, 2027. That is 50 cents more than the 2026 rate of $16.90. Higher local or industry rates still apply where they exist.

When does the California minimum wage increase take effect?

The new $17.40 rate takes effect on January 1, 2027. The Department of Finance certified it on July 31, 2026, so employers have had months of notice to update payroll.

What is the exempt salary in California for 2027?

Exempt employees must earn at least $72,384 a year, or $6,032 a month, from January 1, 2027. They must also meet the duties tests for their exemption, and the salary cannot be pro-rated for part-time work.

Is the California fast food minimum wage going up in 2027?

The sources reviewed for this article list the fast food minimum wage at $20 per hour and do not state a 2027 change. Covered fast food workers must be paid at least $20, which is already above the new $17.40 state rate.

How much is $17.40 an hour a year?

Working 40 hours a week for 52 weeks, $17.40 an hour equals $36,192 a year before taxes. That is about $696 a week, or $1,040 more per year than full-time pay at $16.90.

Do California cities have a higher minimum wage than $17.40?

Yes. Several cities and counties, including Los Angeles, San Diego, San Francisco and Emeryville, have their own higher minimums. Employers must pay whichever rate is highest where the work is done.

How do I report an employer that pays below minimum wage in California?

Document your hours and pay, raise it with your employer, and if it is not fixed, file a wage claim with the California Labor Commissioner's Office. You can call 833-526-4636 for help, and you do not have to disclose your immigration status.

This article was compiled by the Jobsiz editorial team from the official California Department of Industrial Relations notices and the other sources listed below, with AI-assisted writing and automated fact-checking. It is general information, not legal advice.