The Register, Issue 1: $72,384 is California’s new exempt line

This is the first issue of The Register. It arrives on the 2nd and the 16th of each month, in two halves: what changed, and one thing to do about it. A paragraph for professionals, a paragraph for the companies that hire them.

What changed: $72,384 is the new exempt line

California’s minimum wage rises to $17.40 an hour on January 1, 2027; the state certified the number on July 31. The salary floor for most exempt employees is twice the state minimum wage for full-time work, so it moves too, to $72,384 a year.

For professionals

If you are salaried and exempt at or near $72,000, check your pay against $72,384 now. Below that line, your employer has to raise your salary or start paying you overtime. If you are interviewing, ask for the pay scale before you name a number: in California an employer has to give it to you on reasonable request, under Labor Code 432.3. Here is what the first offer costs you if you skip that step.

For companies

Pull every exempt salary under $72,384 before December. Each one needs a decision before January 1: raise it, or reclassify the role as non-exempt and start tracking hours. The risk is the employee nobody checked, because a missed one turns into back overtime and penalties. What a compliance check-up covers.

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• The HR Desk is open: templates, a monthly Desk Brief and live office hours on the first Thursday of each month, starting November 5. $39 a month or $390 a year. See the Desk.
• Case study: a senior HR leader went from about 35 applications and no interviews to an offer on day 19. Read how. Internal case: the candidate is affiliated with Urban Human Resources.

One thing to do this week

Put January 1 on your calendar and spend fifteen minutes before then with your pay stub or your payroll register. Fifteen minutes now costs less than one overtime claim in March.

McKinley holds a J.D. but is not a licensed attorney. Articles here are general information, not legal advice. For your specific situation, talk with an employment attorney.