The headline numbers
2026 minimum is $16.90 for all employers (indexed annually). Several cities/counties higher: SF, LA, Berkeley, others $18+.
California does not allow a tip credit. Employers must pay tipped workers the full state minimum wage of $16.50/hour as direct wage, with tips on top. This makes California one of 7 jurisdictions where the tip credit is prohibited. Tipped workers in California earn structurally more direct wage than workers in tip-credit states, and don't depend on tips to hit minimum wage.
Tip pool rules
No tip credit allowed. Tip pools permitted but cannot include managers/supervisors (per Labor Code 351). Employer cannot deduct credit card processing fees from tips (Labor Code 351).
Universal rules that apply in every state regardless of tip credit status:
- Managers and supervisors cannot keep any portion of tips, even in a valid tip pool. This is a federal rule under FLSA Section 203(m)(2)(B) and applies in California.
- Workers must keep all tips minus valid tip pool / tip-out contributions.
- If the employer uses a tip credit, only customarily tipped employees can be in the tip pool. To include BOH (cooks, dishwashers), the employer must pay full minimum wage to all participants.
Sidework and the 80/20 rule in California
Not applicable — full state minimum wage paid for all hours regardless of duty type.
Because California doesn't allow a tip credit at all, the 80/20 rule is structurally moot here — every hour you work is paid at full state minimum wage regardless of duty type.
Local minimums that may apply
Several cities and counties in the U.S. set higher minimum wages than their state. Local minimums always supersede state minimums where applicable. Check whether your city has its own ordinance:
- San Francisco ($18.67+), Los Angeles ($17.28+), Berkeley ($18.67+), and several other CA cities
Notable state-specific items
- No tip credit in any context
- Strict tip protection laws — manager tip-sharing is a misdemeanor
- Several cities have higher local minimums
- AB-5 / Prop 22 govern gig worker classification
How to verify the current numbers
Wages, indexed minimums, and tip credit rules change. Always cross-check before relying on specifics:
- State labor agency: https://www.dir.ca.gov/dlse/
- State revenue agency (for tax info): https://www.ftb.ca.gov/
- Federal DOL Wage and Hour Division: dol.gov/agencies/whd