USA: California 2027 minimum wage confirmed at $17.40/hour

On 31 July 2026, the California Department of Finance certified next year’s automatic inflation-linked minimum wage adjustment. The rate rises from $16.90 to $17.40 an hour on 1 January 2027 – an increase of about 3%. This also lifts the salary threshold for exempt (salaried) employees to $72,384 per year, because California defines that threshold as double the annual minimum wage for full-time work.

Effective Date

• 1 January 2027

Published

• California Department of Finance certification, 31 July 2026

Payroll action

• Load $17.40/hour into payroll for all California employees effective 1 January 2027.
• Review every exempt employee’s salary against the new $72,384 threshold; give a pay rise or reclassify to hourly and pay overtime.
• Confirm your payroll system uses the highest applicable rate (state, city, or industry) for each employee.
• Keep the fast-food $20.70 and applicable healthcare rates configured separately.
• Update California workplace posters in December 2026.
• Model 2027 wage costs now so budget owners can plan.

ca.gov