The history of California’s minimum wage runs from roughly $0.16 an hour in 1916 to $16.90 an hour in 2026, with industry-specific floors now reaching $20 for fast food workers and climbing toward $25 for many healthcare workers.1California Department of Industrial Relations. Minimum Wage What began as a narrow protective measure for women and children has grown into a universal wage floor, adjusted automatically for inflation, and layered under dozens of local ordinances that push pay higher still in the state’s most expensive cities.
The First Wage Orders Under the Industrial Welfare Commission
California created the Industrial Welfare Commission in 1913, a five-member board authorized to investigate and set standards for wages, hours, and working conditions. For its first six decades, the commission’s reach was limited to women and children in the workforce.2Justia. Industrial Welfare Com. v. Superior Court Starting in 1916, the IWC issued industry-specific “wage orders” setting minimum pay. The first rate was about $0.16 per hour.
Increases came sporadically rather than on a fixed schedule. The rate reached $1.00 per hour by November 1957 and $1.25 by August 1963.3California Department of Industrial Relations. History of California Minimum Wage Both the modest size of the increases and the long gaps between them reflected the IWC’s deliberative process and the narrow slice of the workforce covered.
Coverage Expands to All Workers
Two shifts in the late 1960s and 1970s transformed the system. Rates began climbing faster, reaching $1.65 by 1968 and $2.00 by March 1974.4U.S. Department of Labor. Changes in Basic Minimum Wages in Non-Farm Employment Under State Law: Selected Years 1968 to 2024 More fundamentally, the Labor Code was amended in the early 1970s to extend minimum wage coverage to virtually all non-exempt employees, including men. The minimum wage became a universal labor standard rather than a protection aimed at particular groups.2Justia. Industrial Welfare Com. v. Superior Court
Through the late 1970s and 1980s, the Legislature increasingly set rates directly instead of leaving the job to the IWC. The floor reached $2.90 in 1979, $3.35 in 1981, and $4.25 in 1991.4U.S. Department of Labor. Changes in Basic Minimum Wages in Non-Farm Employment Under State Law: Selected Years 1968 to 2024
Proposition 210 and the Voters’ Turn
Voters weighed in directly in 1996. Proposition 210 raised the minimum wage to $5.00 per hour beginning March 1, 1997, and to $5.75 per hour beginning March 1, 1998.5California Legislative Analyst’s Office. Proposition 210: Minimum Wage Increase The initiative mattered beyond its dollar amounts: it showed that when the Legislature or the IWC moved too slowly, the ballot could deliver an increase.
The IWC Steps Aside
By 2004, the Legislature had defunded the IWC entirely, and the commission stopped operating on July 1 of that year. Its existing wage orders on hours, conditions, and industry-specific standards remain in force and are enforced by the Division of Labor Standards Enforcement, but the commission itself no longer meets or issues new orders.6California Department of Industrial Relations. Effective July 1, 2004 the IWC Will No Longer Be in Operation
With the IWC sidelined, changes ran entirely through the Legislature. In 2013, Governor Brown signed Assembly Bill 10, raising the minimum wage to $9.00 per hour effective July 1, 2014, and to $10.00 per hour effective January 1, 2016.7California Legislative Information. AB-10 Minimum Wage: Annual Adjustment
Senate Bill 3 and the Climb to $15
Signed in April 2016, Senate Bill 3 set out a year-by-year schedule to reach $15.00 per hour, split by employer size. Larger employers with 26 or more workers moved on the faster track; smaller employers with 25 or fewer trailed by one year at each step.8California Legislative Information. Senate Bill No. 3 – Chaptered
For large employers, the schedule ran:
- 2017: $10.50 per hour
- 2018: $11.00 per hour
- 2019: $12.00 per hour
- 2020: $13.00 per hour
- 2021: $14.00 per hour
- 2022: $15.00 per hour
Small employers hit the same figures a year later, reaching $15.00 on January 1, 2023. SB 3 also gave the Governor a safety valve: a scheduled increase could be temporarily suspended if certain economic signals deteriorated, such as a decline in total non-farm employment or a drop in retail sales tax receipts. That authority is limited to two suspensions.8California Legislative Information. Senate Bill No. 3 – Chaptered
Automatic Inflation Adjustments and the Current Rate
The most durable piece of SB 3 is what happened after both tiers reached $15. Under Labor Code section 1182.12(c), the Director of Finance calculates a new minimum wage by August 1 each year. The increase equals the lesser of 3.5 percent or the change in the U.S. Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), comparing the most recent July-to-June period against the prior year’s. The figure is rounded to the nearest ten cents and takes effect the following January 1. If the CPI-W turns negative, the rate stays flat rather than dropping.9California Legislative Information. California Labor Code 1182.12
Once the SB 3 phase-in finished in January 2023, the employer-size distinction disappeared and all California employers moved to a single statewide rate. The indexing formula has produced steady annual increases since:
- January 1, 2023: $15.50 per hour (first unified rate)
- January 1, 2024: $16.00 per hour
- January 1, 2025: $16.50 per hour
- January 1, 2026: $16.90 per hour
The 2026 rate of $16.90 per hour applies to all employers regardless of size.10California Department of Industrial Relations. Minimum Wage Frequently Asked Questions
Higher Floors for Fast Food and Healthcare Workers
Starting in 2024, California moved beyond a single statewide number by creating higher minimum wages for two large sectors.
Fast Food: AB 1228
Assembly Bill 1228, signed in 2023, set a $20.00 per hour minimum wage for fast food workers effective April 1, 2024. It covers employees at limited-service restaurants that belong to chains with at least 60 locations nationwide. Restaurants inside grocery establishments are excluded, as are bakeries that produce and sell bread as a standalone menu item.11California Legislative Information. Assembly Bill 1228 The law also created the Fast Food Council, which can raise the fast food minimum wage each year by the lesser of 3.5 percent or the change in the CPI and adopt broader standards for the industry.12California Department of Industrial Relations. Fast Food Minimum Wage Frequently Asked Questions
Healthcare: SB 525
Senate Bill 525, also signed in 2023, put covered healthcare employees on a path to $25.00 per hour, though timing varies sharply by employer type. The largest health systems (10,000 or more employees), dialysis clinics, and Los Angeles County facilities move fastest, reaching $23.00 in June 2024, $24.00 in mid-2025, and $25.00 in mid-2026. Community clinics, rural health clinics, and certain urgent care facilities follow a slower schedule that reaches $25.00 by mid-2027. Rural hospitals and facilities in small counties started at $18.00 with 3.5 percent annual increases and do not reach $25.00 until 2033. Remaining healthcare employers fall in between, reaching $25.00 by mid-2028.13California Department of Industrial Relations. Minimum Wage Order Supplement for Health Care Facilities
Local Ordinances on Top of the State Rate
The Labor Code does not stop cities and counties from setting their own minimum wages above the state floor, and dozens have. Employers must pay whichever rate is highest among the federal, state, and local minimums for the location where the work is performed.
As of 2026, local minimum wages range from roughly $17.34 in Oakland to $20.25 in West Hollywood. Several Bay Area cities cluster near the top: Emeryville at $19.90, Mountain View at $19.70, San Francisco at $19.61, and Sunnyvale at $19.50. Farther south, Los Angeles sits at $18.42 and San Diego at $17.75. Most of these ordinances carry their own annual adjustment formulas tied to a local or regional CPI, so the pattern shifts every year.
For employers with sites across California, an employee in San Francisco earns a different legal minimum than a coworker for the same company in Sacramento, where only the state rate applies. That geographic layering has become one of the defining features of California’s wage framework, and it has grown more complex as more cities adopt their own rules.