February 5, 2023

Volume XIII, Number 36

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California Minimum Wage Increases for 2023

Effective January 1, 2023, California employers will be required to meet new minimum wage requirements, at both the state and local level.  This increase in the minimum wage affects not only non-exempt employees, but also the minimum annual salary requirement for overtime exempt employees.

Increase and Consolidation of the California Minimum Wage

Previously, the State of California employed a two-tiered minimum wage system, requiring employers with 25 or more employees to pay a higher minimum wage than employers with fewer than 25 employees.  Beginning on January 1, 2023, all employers, regardless of size, must provide their employees a minimum wage of not less than $15.50 per hour.

Increase to the Minimum Annual Salary for Overtime-Exempt Employees

California law provides that overtime-exempt employees must receive a salary that is not less than two times the state minimum wage.  In light of the new increase to the state minimum wage, effective January 1, 2023, the minimum annual salary for overtime-exempt employees will also increase to $64,480.

A Higher Minimum Wage for Employees Working in Select California Cities

Select California cities will raise the minimum wage for non-exempt employees working within city limits.  Non-exempt employees working within one of these cities must be paid the local minimum wage when greater than the California state minimum wage.  However, overtime-exempt employees working in one of these cities need not be paid more than the California state minimum annual salary of $64,480.  The following list contains the local minimum wage rate, effective January 1, 2023, for non-exempt employees working in each of the California cities listed below:

Jurisdiction

Minimum Wage Rate

Belmont

$16.75/hour

Burlingame

$16.47/hour

Cupertino

$17.20/hour

Daly City

$16.07/hour

East Palo Alto

$16.50/hour

El Cerrito

$17.35/hour

Foster City

$16.50/hour

Half Moon Bay

$16.45/hour

Hayward

$16.34/hour (26 or more employees)

$15.50/hour (1-25 employees)

Los Altos

$17.20/hour

Menlo Park

$16.20/hour

Mountain View

$18.15/hour

Novato

$16.32/hour (100 or more employees, including people employed outside the city)

$16.07/hour (26-99 employees)

$15.53/hour (1-25 employees)

Oakland

$15.97/hour

Palo Alto

$17.25/hour

Petaluma

$17.06/hour

Redwood City

$17.00/hour

Richmond

$16.17/hour

San Carlos

$16.32/hour

San Diego

$16.30/hour

South San Francisco

$16.70/hour

San Jose

$17.00/hour

San Leandro

Current $15.00/hour rate expected to increase on 1/1/23, as it will be below the state minimum wage.

San Mateo

$16.75/hour

Santa Clara

$17.20/hour

Santa Rosa

$17.06/hour

Sonoma

$17.00/hour (26 or more employees, including those working outside the city)

$16.00/hour (1-25 employees)

Sunnyvale

$17.95/hour

West Hollywood

$17.50/hour (50 or more employees)

$17/hour (1-49 employees)

California employers should work with their payroll providers to increase the relevant minimum wage for affected exempt and non-exempt employees, and ensure that the new rate is paid and properly recorded on employee pay stubs by January 1, 2023.

© 2023 Proskauer Rose LLP. National Law Review, Volume XII, Number 342
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About this Author

Anthony J Oncidi, Employment Attorney, Proskauer Rose Law Firm
Partner

Anthony J. Oncidi heads the Labor & Employment Law Group in the Los Angeles office. Tony represents employers and management in all aspects of labor relations and employment law, including litigation and preventive counseling, wage and hour matters, including class actions, wrongful termination, employee discipline, Title VII and the California Fair Employment and Housing Act, executive employment contract disputes, sexual harassment training and investigations, workplace violence, drug testing and privacy issues, Sarbanes-Oxley claims and employee raiding and trade secret protection....

310-284-5690
Associate

Wesley counsels clients in a wide range of labor and employment legal matters, including wage and hour issues, personnel policies and procedures, employee discipline matters, leaves of absence, WARN Act compliance, and labor and employment law issues that arise in corporate transactions. He also drafts and reviews employment agreements, independent contractor agreements, commission and bonus plans, separation agreements, and other documents related to the entire life cycle of the employment relationship.

Wesley has litigated a variety of...

310-284-4574
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