California workers just got a pay raise too. Effective January 1, 2007, every employer must pay an employee a minimum wage of $7.50 per hour. The minimum wage will again increase on January 1, 2008, to $8.00 per hour. Cal. Lab. Code §§ 1182.12-1182.13. Compliance with the law includes posting California Employer Posters reflecting the new minimum wage increase.

Some exempt executive, administrative, and professional employees may also be affected by the minimum wage increase. To qualify for the exemption from California’s overtime requirements, a full-time (40 hours per week) executive, administrative, or professional employee must earn a monthly salary equal to at least two times the California minimum wage. Effective January 1, 2007, an exempt employee must earn $31,200 per year (increasing to $33,280 per year effective January 1, 2008).

Employers should take note of the minimum wage increase, particularly in regard to those employees who must earn at least two times the California minimum wage in order to qualify for the exemption from overtime requirements. These requirements are different from and more onerous than the requirements under the Fair Labor Standards Act.