On July 1, 2025, new increased minimum wage rates will go into effect in many California cities and counties. Local governments have looked to offset the effects of inflation and have decided to use minimum wage ordinances to address the increased cost of living in many localities within the state. As a result, many jurisdictions in California have established higher minimum wages than California’s current minimum wage rate of $16.50/hour. These municipalities include, but are not limited to: Alameda, Belmont, Berkeley, Burlingame, Cupertino, Daly City, East Palo Alto, El Cerrito, Emeryville, Foster City, Fremont, Half Moon Bay, Los Altos, Los Angeles (city and county), Malibu, Menlo Park, Milpitas, Mountain View, Novato, Oakland, Palo Alto, Pasadena, Petaluma, San Carlos, San Diego, San Francisco, San Jose, San Leandro, San Mateo (city and county), Santa Clara, Santa Monica, Santa Rosa, Sonoma, South San Francisco, Sunnyvale, and West Hollywood.
Generally, employers are required to pay a higher state or local minimum wage. Employers should check compliance with their local minimum wage law to ensure they will be paying employees the correct amount by July 1, 2025. Employers must comply with the more stringent law (when compared with the state/Federal).
A non-exhaustive list of increases is below:
- Berkeley: $19.18/hr (up from $18.67/hr)
- City of Los Angeles: $17.87/hr (up from $17.28)
- Emeryville: $19.90/hr (up from $19.36/hr)
- Fremont: $17.75/hr (up from $17.30/hr)
- Los Angeles County (unincorporated areas): $17.81/hr (up from $17.27/hr)
- Milpitas: $18.20/hr (up from $17.70/hr)
- Pasadena: $18.04/hr (up from $17.50/hr)
- San Francisco: $19.90/hr (up from $18.67/hr)
- Santa Monica: $17.81/hr (up from $17.27/hr)
In addition, some cities have industry-specific minimum wage laws. For example, hotel workers in West Hollywood will see an increased rate to $20.22/hr as of July 1, 2025 (up from $19.61/hr). And for hotels and businesses operating on hotel property, those employers will need to pay covered workers $21.01/hr as of July 1, 2025 (up from $20.32/hr). NOTE: This is subject to change, as on May 12, 2025, the City of Los Angeles City Council voted to approve a proposal to require a $22.50 minimum wage for hotel workers effective July 1, 2025, subject to a final vote by the City Council and action by the mayor. If this ordinance becomes effective, the City of Santa Monica’s hotel worker living wage will also increase to $22.50/hr effective July 1, 2025, or the soonest date thereafter that the ordinance becomes effective.)
Notably, covered fast food workers in California must be paid at least $20.00/hr, (which exceeds many local rates for non-fast food workers.) This increase was due to AB 1228, which amended the Labor Code to provide a minimum wage for fast food restaurant employees. A city or county local minimum wage may exceed $20.00/hr, and employers must pay the higher rate.
Other cities, such as Milpitas, have laws that raise the minimum wage rate every July 1, based on the increased cost of living. This is usually calculated and set by the relevant local Consumer Price Index (“CPI”) as published by the U.S. Department of Labor, Bureau of Labor Statistics. Municipalities rely on the CPI to determine and adjust minimum wage ordinances in California to reflect the cost of living and to keep pace with inflation.
To summarize, California employers should review the applicable local minimum wage for all employees (including remote employees) to ensure they are paying the correct rate and get ready to implement increases for July 1, 2025.
