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California Minimum Wage & City Ordinances: Navigating Overlapping Rates

No expert reviewer assigned to this entry. General information, not legal advice.

If you run a business in California, the state minimum wage is only your starting point. For 2026, the California minimum wage is $16.90 an hour. But dozens of California cities set their own, higher rates, and your payroll has to follow the highest rate that applies to the work being done.

The three layers of wage law

Every California paycheck sits under up to three layers of rules:

  1. Federal: The Fair Labor Standards Act sets the national floor at $7.25 an hour, where it has sat since July 24, 2009. It rarely decides anything in California, but it is the backstop under everything else.
  2. State: California's $16.90 rate covers every employer in the state, whatever your size.
  3. City: Local ordinances in Los Angeles, San Francisco, Berkeley, and dozens of smaller cities push the rate higher inside city limits.

When the layers conflict, the employee gets the highest rate. You don't get to pick the cheapest one.

What the cities actually charge

City rates aren't a few cents above the state rate. Some are more than $3 higher:

  • Emeryville: $20.34 an hour since July 1, 2026. One of California's smallest cities has the highest city rate on our list, and it applies to every business in town.
  • West Hollywood: $20.25 an hour for most workers since January 1, 2026, and $20.87 for hotel employees since July 1.
  • San Francisco: $19.61 an hour since July 1, 2026. A lower rate of $17.35 applies to Government Supported Employees.
  • Berkeley: $19.61 an hour since July 1, 2026.
  • Los Angeles: $18.42 an hour since July 1, 2026, adjusted each year with the regional cost-of-living index. The Los Angeles minimum wage page tracks the current figure and its posting duties.
  • San Jose: $18.45 an hour since January 1, 2026.
  • San Diego: $17.75 an hour since January 1, 2026, with separate hospitality rates for covered hotel, amusement park, and event center workers that started July 1.
  • Oakland: $17.34 an hour since January 1, 2026, under Measure FF.

Smaller cities count too. Mountain View is at $19.70, Sunnyvale at $19.50, and Richmond at $19.18 — or $17.68 if you pay at least $1.50 an hour toward an employee's medical benefits. Sonoma splits its rate by size: $18.47 an hour if you have 26 or more employees, $17.38 if you have 25 or fewer.

Which rate applies to which hours

The rate follows the work, not your headquarters. Under most city ordinances, an employee who works at least two hours inside a city in a given week earns that city's rate for those hours. A driver based in a state-rate town who spends a morning making deliveries in Los Angeles is an LA-rate employee for that morning.

This is where multi-location businesses get caught. Your payroll needs a rate for every place your people actually work, not one rate for the whole company.

Two raise dates, not one

California's state rate changes on January 1. Many city rates change on July 1. Los Angeles, San Francisco, Emeryville, Berkeley, Santa Monica, and Pasadena all adjusted on July 1, 2026, while San Jose, San Diego, and Oakland moved on January 1. If you only review wages every January, you can run half the year at an illegal rate in the July cities without noticing.

What to do

  1. List every location where your employees work, including regular remote and travel patterns.
  2. Match each location to its city ordinance. Write down the current rate and the date it changes next.
  3. Set up a separate pay code in payroll for each city rate, so hours land at the right rate automatically.
  4. Post the required wage notice for each city where you have staff. Every ordinance has its own poster, and "we didn't know" is not a defense.
  5. Put both January 1 and July 1 on your compliance calendar, and re-check the rates about a month before each date.

Mistakes that get expensive

  • Paying the state rate inside a city. $16.90 an hour is legal in a town with no ordinance. In San Francisco, where the rate is $19.61, it's an underpayment on every single hour.
  • Using your office city's rate for everyone. Field staff, drivers, and remote workers carry their work city's rate with them.
  • Missing the special rates. Hotel workers in Los Angeles and Santa Monica get $25.00 an hour under separate ordinances, well above the general city rate.
  • Treating the wage as the whole job. The same staff also earn California paid sick leave — at least 40 hours or 5 days a year — and California's meal and rest break rules are strict. A correct hourly rate with broken leave and break practices is still a violation.

Quick questions

Can I just pay everyone the highest rate I face? Yes. Nothing stops you from paying the Emeryville rate everywhere. It costs more, but it removes the tracking problem entirely.

An employee splits the week between two cities. Which rate applies? Each city's rate for the hours worked there, once the employee passes that city's coverage threshold — often two hours in a week.

How do I check the exact rate for my locations? Run your cities and headcount through our Free Employer Compliance Checker and it will line up the federal, state, and city rules that apply to you.