The California Department of Industrial Relations (DIR) announced on Tuesday, September 26th that California’s minimum wage will increase to $16 per hour for all employers on January 1, 2024. Some cities and counties in California have a local minimum wage that is higher than the state rate, which will supersede this rule.
The change in the minimum wage also affects the minimum salary an employee must earn to meet one part of the overtime exemption test. Exempt employees are not subject to the payment of overtime for hours worked. An employee must earn no less than two times the state’s minimum wage for full-time work to meet this initial requirement of the exemption test. As of January 1, 2024, employees in California must earn an annual salary of no less than $66,560 to meet this threshold requirement.
Currently, the minimum wage is $15.50 for all employees regardless of employer size.
Employers must post the Minimum Wage Order and the Wage Order applicable to their workplace at a worksite area accessible to employees. The wage orders can be downloaded and printed from the workplace postings page on the DIR website, or the Guardian HR Forms Library’s Hiring Folder under “New Hire Packs & Documents”.
Employers must also ensure that the wage rate is displayed on the employee’s pay stub, and that employees are paid at least the minimum wage even when employees are paid at piece rate.
For an overview of all currently released minimum wage rates and their planned increases, please visit the chart titled “Minimum Wage Rates by State and Municipality.xlsx” located in the Guardian HR Forms Library\Compensation and Payroll\State Laws\Compensation and Payroll Information By State Spreadsheets
For an overview of the minimum salary thresholds for exempt employees by state, please visit the Guardian HR Forms Library\Exempt vs. Non-Exempt\State Specific Guidance\Minimum Salary Levels for Executive, Administrative and Professional Employees by State.xlsx