California Minimum Wage: Everything You Need To Know

California Minimum Wage: Everything You Need To Know
What is the minimum wage in California in 2022? Learn everything you need to know about changing wages in 2022 from Square.
by Square Oct 27, 2022 — 3 min read
California Minimum Wage: Everything You Need To Know

Small business owners in the Golden State know how important it is to stay up to date on minimum wage regulations. You want to make sure you’re complying, of course. But staying aware of upcoming changes in the California minimum wage landscape also lets you plan better for your business’ future.

That’s why we put together this quick guide with what you need to know about the minimum wage in California in 2022.

What is the minimum wage in California in 2022?

As of January 1, 2022, California’s minimum wage is $14 per hour for companies with 25 employees or fewer and $15 for companies with 26 employees or more. This is $6.75 and $7.75 more than the federal minimum wage of $7.25 respectively.

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Is the minimum wage going up in California in 2022?

The California minimum wage increase will happen each year until reaching $15 per hour for all businesses in 2023.

Once the minimum wage reaches $15 per hour, wages could then be increased each year up to 3.5 percent for inflation.

Year 26 Employees or More 25 Employees and Fewer
2021 $14 $13
2022 $15 $14
2023 $15 $15

What is the minimum wage in L.A. county?

Many cities and counties in California have their own minimum wage that differs from the California minimum wage. The reason for the change is to keep up with the cost of living in cities where it is significantly higher than the rest of the state. The L.A. county minimum wage in 2020 was $14.25 for both large (26 or more employees) and small businesses (25 or fewer employees). The minimum wage in 2021 is $15 per hour for all businesses.

The city of Los Angeles has its own minimum wage laws that differ from the county as a whole. However, in 2021 the Los Angeles minimum wage was set to $15 and will remain that amount throughout 2022.

Are there any other California cities that have a higher minimum wage?

Yes. The San Francisco minimum wage ordinance for 2020 set all minimum wage employees pay at $16.07 but will increase to $16.32 on July 1, 2021. This is $2.32 more than the current California minimum wage for companies with 25 or fewer employees and $1.32 more than California’s minimum wage for companies with 26 and more employees

Cupertino’s minimum wage is also currently greater than the state minimum wage. All businesses are required to pay a minimum wage $16.40 per hour starting on January 1, 2022.

San Diego’s minimum wage tracks more closely with the minimum wage in California, with some exceptions. The minimum wage in San Diego increases from $14 to $15 starting on January 1, 2022, regardless of the number of employees.

How should small business owners prepare for minimum wage increases?

Every business is different, so there isn’t one right way to prepare for the California minimum wage in 2022. Here are a few options you may want to consider:

Whether you need help understanding the California minimum wage, the California sick leave law, or resources to help your small business grow, Square is here to help both you and your business thrive. Lastly on a related note to California, learn more about how Square is helping small business owners with payroll services in the San Francisco Bay Area.

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