California Healthcare Worker Minimum Wage (SB 525) Explained

California’s healthcare minimum wage under SB 525 requires covered health care facilities to pay most of their workers between $19.28 and $25 an hour as of July 1, 2026, depending on the type of facility, well above the $16.90 state minimum wage. It covers far more than nurses and aides: janitors, cooks, security officers, clerks, billers and gift shop workers at covered facilities are included too.

The difference is significant. A full-time worker at a large health system who is paid the regular state minimum instead of the $25 healthcare rate loses $8.10 an hour, or about $16,848 a year. Unpaid minimum wages also carry liquidated damages that can double what you are owed.

This guide explains which facilities and jobs SB 525 covers, the current rates and future steps for each tier, the higher salary needed to treat a healthcare worker as exempt, the most common violations, what you can recover, and what to do if you think you are underpaid.

What SB 525 is and when it took effect

SB 525 created a separate minimum wage for health care workers, now found in Labor Code sections 1182.14, 1182.15 and 1182.16. It was originally set to begin June 1, 2024, but was delayed, and the first rates took effect on October 16, 2024. County-operated facilities started on January 1, 2025.

The law works in steps. Each tier starts at an initial rate and rises on set dates, usually July 1, until it reaches $25 an hour. Once a tier reaches $25, later increases are tied to inflation. Large health systems and dialysis clinics reached $25 on July 1, 2026. Other tiers will get there between 2027 and 2033.

The healthcare minimum wage applies on top of everything else in California wage law. You are still owed overtime, meal and rest breaks, paid sick leave and accurate pay stubs. The difference is that the floor for calculating your pay is higher.

By the numbers$25

Which facilities are covered

The Department of Industrial Relations (DIR) lists a wide range of covered health care facilities, including:

• General acute care hospitals, acute psychiatric hospitals and psychiatric health facilities
• Skilled nursing facilities and residential care facilities owned or operated by a hospital or integrated health system
• Licensed home health agencies
• Physician groups with 25 or more physicians
• Dialysis clinics, surgical centers, urgent care clinics, rehabilitation clinics and alternative birth centers
• Community clinics, rural health clinics and certain university and government clinics
• County mental health and correctional health facilities

Some facilities are excluded, including stand-alone skilled nursing facilities that are not owned by a hospital or integrated system, congregate living health facilities, and facilities operated by the State of California (the University of California is covered). Coverage rules are technical, so if your employer says it is “not covered,” that claim is worth checking.

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Which employees are covered

A covered health care employee is someone who works at a covered facility and provides patient care, health care services, or services supporting the provision of health care. The DIR’s list is deliberately broad. It includes:

• Nurses, caregivers, aides, technicians and medical residents
• Janitorial, housekeeping and groundskeeping workers
• Security guards
• Food service, laundry and gift shop workers
• Clerical staff, schedulers, medical coders and billers
• Call center and warehouse workers

Workers employed by contractors can also be covered. In general, a contractor’s employee who provides these services under a contract with a covered facility is covered when the facility is a joint employer or the worker spends at least half of their working time at the facility. If you clean, cook or guard at a hospital through an outside company, ask whether you are being paid the healthcare rate.

Healthcare minimum wage rates in California for 2026

These are the rates in effect from July 1, 2026, according to the DIR’s posted notice. Your rate depends on your facility’s tier.

Facility type	Rate from July 1, 2026	Next step
Large health systems (10,000+ full-time equivalent employees), dialysis clinics, and counties over 5 million people	$25.00	Inflation adjustments from January 1, 2028
Community, rural health and intermittent clinics, and certain urgent care clinics	$22.00	$25.00 on July 1, 2027
All other covered facilities, and counties of 250,000 to 5 million people	$23.00	$25.00 on July 1, 2028
Hospitals with a high share of Medicare and Medi-Cal patients, independent rural hospitals, and counties under 250,000 people	$19.28	Annual increases until $25.00 in 2033

Some clinics have received waivers through a DIR program, which can change their schedule. Rates are also posted on the official supplement to the minimum wage order that your employer must display. When in doubt, check the DIR’s healthcare minimum wage page or ask us to look at your situation.

💡 Example: Rosa works 40 hours a week in housekeeping at a hospital in a large health system. After July 1, 2026, her employer keeps paying her $21 an hour instead of $25. She loses $4 × 40 = $160 a week. Over 13 weeks, that is $2,080 in unpaid minimum wages, and liquidated damages under Labor Code 1194.2 can add an equal amount, for $4,160 plus interest.

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The higher salary needed to be exempt

SB 525 also raised the bar for treating covered healthcare workers as salaried and exempt from overtime. To be exempt, a covered employee must generally earn a salary of at least 150% of the applicable healthcare minimum wage or 200% of the state minimum wage, whichever is greater, for full-time work, and must also meet the duties test for the exemption.

Healthcare tier	150% of healthcare rate (annual)	Minimum exempt salary
$25.00 tier	$78,000	$78,000
$23.00 tier	$71,760	$71,760
$22.00 tier	$68,640	$70,304 (state threshold is higher)
$19.28 tier	$60,154	$70,304 (state threshold is higher)

If you are a salaried coordinator, supervisor or administrator at a covered facility earning below these amounts, you may be misclassified and owed overtime. Read our guide on misclassified exempt employees.

By the numbers$78,000

Common violations and employer defenses

The healthcare minimum wage is new enough that mistakes are common. Watch for:

• Wrong tier. The employer pays a lower tier’s rate than its facility type requires.
• Contractor workers left out. Janitorial, food service and security contractors keep paying the regular minimum wage at a covered hospital.
• Overtime based on the old rate. Your overtime rate must be at least 1.5 times your actual regular rate, which cannot be lower than the healthcare minimum.
• Premiums at the wrong rate. Meal and rest break premiums are owed at your regular rate of pay. Hospital workers on long shifts should also read our guide on 12-hour shifts and alternative workweeks.
• Salaried staff below the new exempt threshold. They must be reclassified or paid a higher salary.

Employers often argue that a worker’s job does not “support” health care, or that a clinic falls outside the definitions. According to the DIR, the employer carries the burden of showing that you are not entitled to the healthcare minimum wage.

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What you can recover and how long you have

If you were paid less than the healthcare minimum wage, you may be able to recover:

• The unpaid difference in wages, plus interest
• Liquidated damages equal to the unpaid minimum wages (Labor Code 1194.2)
• Unpaid overtime and break premiums recalculated at the correct rate
• Waiting-time penalties if you have left the job and your final pay was short (Labor Code 203)
• Pay stub penalties (Labor Code 226) and, in many cases, PAGA penalties
• Attorney’s fees and costs (Labor Code 1194)

Minimum wage claims generally must be brought within three years (Code of Civil Procedure 338), or four years when paired with an unfair competition claim. You can file with the Labor Commissioner or in court; see Labor Commissioner claim vs. hiring a lawyer. Retaliating against you for asking about your rate is illegal under Labor Code 98.6.

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What to do if you think you’re underpaid

1. Identify your employer and facility. Note who signs your paycheck and which facility you work at, including whether it is part of a larger health system.
2. Check your pay stubs. Compare your hourly rate, after July 1, 2026, with the tier table above.
3. Track where you work. If you are a contractor’s employee, keep a record of how much of your time you spend at the covered facility.
4. Look for the posted notice. Covered employers must post the healthcare supplement to the minimum wage order.
5. Ask in writing. A short email asking which healthcare minimum wage tier applies to your job creates a record.
6. Talk to a lawyer. Healthcare minimum wage problems usually affect many coworkers, which can support a class or PAGA action.

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Frequently asked questions

What is the healthcare minimum wage in California in 2026?

It depends on the facility. As of July 1, 2026, the rates are $25 at large health systems, dialysis clinics and the largest counties; $23 at most other covered facilities; $22 at covered clinics; and $19.28 at hospitals with a high share of Medicare and Medi-Cal patients, independent rural hospitals and small counties.

Does SB 525 cover janitors and food service workers?

Yes. The law covers workers who support the provision of health care at covered facilities, including janitorial, housekeeping, food service, laundry, security and clerical workers.

I work for a staffing or contracting company at a hospital. Am I covered?

Often, yes. Contractor employees are generally covered when the hospital is a joint employer or they spend at least half their working time at the covered facility.

Are home health aides covered?

Workers at licensed home health agencies are covered. Caregivers employed through other arrangements, such as in-home supportive services, may not be.

Can my employer cut my hours to avoid paying the healthcare rate?

An employer can generally set schedules, but cuts made in retaliation for asking about or claiming your rate are illegal. Talk to a lawyer if your hours dropped after you raised the issue.

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