Effective Jan. 1, 2019, the statewide minimum wage in California increased from $10.50 to $10.00 for employers with less than 25 employees and from $11 to $12 per hour for employers with more than 25 employees. This also impacts other wage and hour obligations, such as the minimum salary requirement for exempt employees, which increased to $49,920.
In addition to the statewide minimum wage, several cities and counties have adopted their own minimum wage requirements; more information is available on the University of California, Berkeley Labor Center website. In several areas, such as San Jose, the minimum wage increased from $13.50 to $15 per hour. In other areas, such as in the city and county of Los Angeles, the minimum wage increases from $13.25 to $14.25 per hour effective July 1, 2019. Under California law, employers must comply with the highest applicable minimum wage.
Further, California Labor Code sections 515.5 and 515.6 provide overtime exemptions for certain computer professionals and licensed physicians. One aspect of the exemption requires a minimum rate of pay, which is subject to an annual adjustment by Department of Industrial Relations (DIR) when there is an increase in the Consumer Price Index. Effective Jan. 1, 2019, the licensed physician or surgeon minimum hourly rate of pay to qualify as exempt from overtime will increase from $79.39 to $82.72.
The computer software professional minimum hourly rate of pay will increase from $38.89 to $39.90 beginning Jan. 1, 2019. The minimum monthly salary will increase from $6,752.19 to $6,927.75, and the minimum annual salary will increase from $81,026.25 to $83,132.93.