Winter is upon us! As we prepare for the holidays and the start of a new year, it’s the perfect time to check in on your company’s employment policies and practices. As usual, California lawmakers were busy in 2025, and multiple employment-related laws are scheduled to take effect on January 1, 2026. These laws address a wide range of workplace matters, such as wages, payments, notices to employees, and leaves of absence. We review several of the most important new laws below.
Starting January 1, 2026, California’s minimum wage for non-exempt employees will increase from $16.50 to $16.90 per hour. While employers with operations in California will need to ensure that non-exempt employees are paid at least $16.90 per hour (or higher applicable industry or local rates), they must be mindful that the increase in the state minimum wage also impacts what they must pay to many exempt employees. Since the salary threshold for most overtime exemptions in California is twice the state’s minimum wage for full-time work, the minimum annual salary for exempt positions will increase from $68,640 to $70,304. Employers should ensure compliance with the increased wage requirements to avoid risks and potential wage-and-hour claims.
Under this new law, it will be unlawful to include terms in employment contracts that require workers to pay employers penalties or fees or repay costs...
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