In June 2016, California legislature introduced and passed the law for phasing in statewide minimum wage increases that will ultimately reach $15 / hour by 2022 for larger employers and by 2023 for smaller employers.
For employers with more than 25 employees, the hourly minimum wage will increase according to the following schedule: to $10.50 on January 1, 2017; to $11.00 on January, 2018; to $12.00 on January 1, 2019; to $13.00 on January 1, 2020; to $14.00 on January 1, 2011; and to $15.00 on January 1, 2022.
For employers with 25 or fewer employees, the minimum wage increases will begin on January 1, 2018, and will continue at the same pace ultimately reaching $15.00 on January 1, 2023.
The law contemplates annual subsequent increases after the final scheduled increase, generally tied to consumer inflation, which the Director of Finance will determine by August 1st of each year, with the increase rounded to the nearest 10 cents, to become effective the following January 1.
The above increases to the hourly minimum wage will also impact the salary level needed for exempt employee purposes. Thus, the salary level for exemption purposes for larger employers increased from the most recent $41,600 to $43,680 on January 1, 2017, and will increase with each subsequent increase, ultimately reaching $62,400. on January 2022.