Effective July 1, 2014, California’s minimum wage will increase from $8 to $9. This hike will affect not only non-exempt, hourly workers, but also workers in various exempt positions that are subject to minimum salary requirements calculated based on the minimum wage. For example, in addition to meeting other requirements, employees in white collar exemptions (i.e., executive, administrative, and professional) must earn at least $3,120 per month ($37,440 per year) and commissioned, inside salespeople must earn at least $13.50 per hour to be exempt from overtime.

Employers should promptly ensure they are paying the appropriate rate to hourly employees and conduct an audit of compensation for salaried employees to ensure compliance with the law.