As we approach the new year, employers should be mindful of the upcoming state and local minimum wage rate increases effective January 1, 2026. While this alert highlights certain increases in New York, New Jersey, and California, employers should carefully review updated requirements applicable to their entire workforce to remain compliant and avoid potential penalties.

With the increase in minimum wage and salary basis rates, employers should also ensure compliance with all applicable written pay rate notice requirements for each jurisdiction applicable to their workforce.

New York

Hourly Wage Increases in New York

• For employees in New York City, Long Island, and Westchester, the basic minimum hourly wage will increase from $16.50 to $17.00.
• For employees in the remainder of New York State, the basic minimum hourly wage will increase from $15.50 to $16.00.

New York will also see industry-specific increases to wage rates such as, but not limited to, the unit rate for janitors (or superintendents) in residential buildings, the minimum cash wage for tipped service employees, and employer tip credits.

Notice and Acknowledgement of Pay Rate and Payday and Wage Statements

Employers must provide all employees with new wage rates with an updated written Notice and Acknowledgement of Pay Rate and Payday that reflects the updated wage rate(s). Changes in an employee’s pay rate(s) must also be reflected in an employee’s wage statements (or paystubs) that are provided with paychecks.

Salary Threshold Increases for Salary Exemption

The minimum weekly salary requirements in New York for employees to qualify for the professional, executive and/or administrative exemptions will increase for:

• New York City, Long Island, and Westchester employees, from $1,237.50 per week to $1,275.00 per week.
• Employees in the remainder of New York State, from $1,161.65 per week to $1,199.10 per week.

Employers should bear in mind that simply meeting the minimum weekly salary requirement does not, alone, render an employee exempt from the minimum wage and overtime laws. An employee is only properly classified as exempt if the employee also meets the criteria required for the particular exemption.

New Jersey

Hourly Wage Increases

New Jersey’s minimum wage will increase for most employees from $15.49 to $15.92 on January 1, 2026.

Pay Rate Notices

At the time of hire, employers must notify employees of their pay rate and the designated regular paydays. Additionally, employers must notify their employees of any changes in the pay rates or pay days before the changes go into effect.

Salary Threshold Increases for Salary Exemption

As New Jersey follows the Fair Labor Standards Act for employees to qualify for the professional, executive and/or administrative exemptions, the minimum weekly salary requirement will remain at $684 per week.

California

Hourly Wage Increases in California

The hourly minimum wage rate will increase from $16.50 per hour to $16.90 per hour.  However, employers should be aware certain cities and counties in California require higher minimum wage rates. For example, on July 1, 2025, the minimum wage rates increased from $17.27 to $17.81 in Los Angeles County and from $17.28 to $17.87 in the City of Los Angeles.

Pay Rate Notices

Employers must provide renewed pay rate notices to employees of their rate of pay, designated pay date, the employer’s intent to claim allowances as part of the minimum wage, and the basis of wage payment (including any applicable overtime rates).

Notice must be provided at the time of hire or within 7 days of a change if the change has not already been listed on the employee’s paystub.  

Salary Threshold Increases for Salary Exemption

The minimum annual salary requirement for employees to qualify for the professional, executive and/or administrative exemptions in California will increase from $68,640 to $70,304. 

Preparing for 2026

Employers should ensure full compliance with the upcoming 2026 minimum wage and salary threshold increases and issue any required revised notices of pay rates to affected employees.

For questions regarding the 2026 wage increases or related compliance requirements, employers are encouraged to consult with legal counsel in advance of the new year to ensure proper compliance with applicable state and local laws.

The Labor & Employment and Litigation teams at Tarter Krinsky & Drogin are carefully monitoring ongoing compliance requirements and can advise your business on the steps that need to be completed to avoid potential penalties.

Afsha Malik, law clerk at Tarter Krinsky & Drogin, also contributed to this article.