California Is Raising the Minimum Salary for Salaried Workers
Salaried employees must earn at least $72,384 a year starting January 1. Check your payroll now.
What's happening
California is raising the minimum pay for salaried employees who don't get overtime. Beginning January 1, 2027, an employee must earn an annual salary of at least $72,384 to meet the salary threshold for exemption. Employees must also meet the job-duties test for their exemption.
Why the salary rule is the real change
The state hourly minimum goes to $17.40 on January 1, but the City of Los Angeles is already higher: its minimum wage rose from $17.87 to $18.42 an hour on July 1, 2026. For Hollywood businesses, the salary threshold is what changes.