Employers in many states and localities will see an increase in minimum wages starting July 1, 2025.
Many Changes Coming in California
As it often does, California leads the way with a patchwork of minimum wage increases across localities and industries scheduled for this summer.
Los Angeles Prepares for the Olympics with Proposed Wage Increases
Employers, workers, and advocates have been closely following headlines regarding Los Angeles’s so-called “Olympic Wage” initiative. The legislation in question, Ordinance 188610, requires higher minimum wages, minimum health benefits, and training standards for employees of large hotels and employers servicing the Los Angeles International Airport (“LAX”). This is not the first time these industries have been singled out; however, this proposal specifically contemplates the upcoming 2026 World Cup and 2028 Olympics.
Los Angeles’s City Council adopted the ordinance on May 23, Mayor Karen Bass signed it into law on May 27, and it was published on May 29. Opponents quickly submitted a petition for referendum, seeking to overturn the ordinance before it takes effect. In accordance with local rules, though the ordinance has been signed into law, if nearly 93,000 signatures are collected within 30 days after publication of the ordinance, it is suspended until it can be placed on a ballot for a general election in June 2026. This leaves the proposed minimum wage increases, and related measures, in flux through at least June 30, 2025.
If the ordinance is not overturned and the new provisions take effect, beginning on July 1, 2025, the minimum wage will increase to $22.50 for workers in hotels with at least 60 guest rooms and employees of employers servicing LAX. If employers servicing LAX do not provide health benefits to an employee, the ordinance stipulates a minimum wage of $30.15 for that employee.
If the referendum passes, and the ordinance does not take effect, the minimum wage for hotel workers will raised slightly to $21.01. Airport workers will be subject to existing minimum wage laws.
The City of Santa Monica matches the hourly wage for hotel workers set by Los Angeles. Santa Monica has already announced that it will apply the increased minimum wage for hotel workers. This means that the outcome of the referendum will impact hotel employers in both Los Angeles and Santa Monica.
We are keeping a close eye on these developments. Employers in the hospitality and tourism industries should be aware of the provisions in the ordinance and prepare for changes, if any, required by July 1, 2025.
First Scheduled Minimum Wage Increase for CA Health Care Workers
Following several amendments, on October 16, 2024, a new minimum wage scale for health care workers went into effect in California. The first scheduled increases start July 1, 2025. There are two tiers of increases effective July 1 depending on the facility.
Tier 1: minimum wage increases from $23 to $24
- Large health systems and dialysis clinics
- “Covered Health Care Facilities” run by large counties
Tier 2: minimum wage increases from $18 to $18.63 (a 3.5% increase)
- “Safety Net Hospitals,” meaning hospitals with high populations of Medicare/Medicaid patients, rural health care facilities, and health care facilities owned, affiliated or operated by a county with a population of less than 250,000
- “Covered Health Care Facilities” run by small counties
Employers should refer to the state’s Labor Commissioner FAQs or our previous post (published prior to amendments that postponed implementation) breaking down the covered facilities and employers for more information.
California Minimum Wage Rate Hikes by Industry
In addition to those detailed above, employers in hospitality-related industries will see increases in the minimum wage in several other California localities. All industry-specific minimum wage increases are detailed below. The minimum wage for fast food workers, which, at $20, is higher than the state’s general minimum wage rate, will not increase on July 1. Employers should keep in mind that these industry-specific minimum wage rates preempt the relevant jurisdiction’s general minimum wage rate.
The following chart summarizes coming industry-specific wage hikes:
* other categories of facilities excluded from July 1, 2025, increases
California General Minimum Wage Rate Hikes by Jurisdiction
Several localities in California will also increase their general minimum wage on July 1, 2025. These cities and counties enforce a minimum wage above the state’s minimum of $16.50. Note that the City of Malibu, one of the localities with scheduled increases effective each July 1, has suspended its planned increase this year in light of the Palisades Fire. Employers should keep in mind that, where applicable, the industry-specific minimum wage rates detailed above preempt each jurisdiction’s general minimum wage rate.
Minimum Wage Increases Outside of California
Though California leads the way in mid-year minimum wage rate hikes, employers in several states and localities will also see increases soon. The following chart summarizes the coming changes, which are effective July 1, 2025, unless otherwise noted. Note that the chart only lists rates that are changing imminently.
* Other categories of employers/employees excluded from July 1, 2025, increases
Employers and payroll processors should be aware of these changes and prepare for minimum wage adjustments taking effect on July 1 or soon thereafter.
Maureen Maher-Patenaude, a Summer Associate (not admitted to practice) in Epstein Becker Green’s New York office, contributed to the preparation of this piece.
ENDNOTES
[1] On February 25, 2025, the City of Burien filed a complaint seeking clarification of a voter-approved initiative regarding the city’s minimum wage. The case is pending in King County Superior Court. The scheduled minimum wage increase for “Level 2 employees” on July 1, 2025, is unaffected by the suit.
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