The new San Diego minimum wage rates for 2026 take effect Jan 1st, 2026.  The rate will increase to $17.75 per our (up from $17.25/hour), and applies to any worker who performs a minimum of two hours of work in even a single calendar week of 2026.  The new rate must be observed and implemented by all companies within city limits, regardless of the number of employees or business volume conducted in our city.  The California minimum wage increases January 1, 2026 to $16.90 per hour for the vast majority of employers.  Higher rates will apply to healthcare and fast food employees.  The California minimum salary for exempt employees increases January 1, 2026 to $1352/week or $70,304 per year.

It is important to note all San Diego and California employers are subject to Federal, State and Local minimum wage laws.

Key Takeaways About the New San Diego Minimum Wage Rates for 2026 Take Effect Jan 1st:

• Minimum wage in the City of San Diego will rise to $17.75 per hour for most workers, effective January 1, 2026.  This applies to any worker who works a minimum of two hours in any single calendar week in 2026.
• California minimum wage rises to $16.90 per hour for the majority of workers in our state.
• There are special rates for some classes of workers, such as fast food employees and healthcare workers.

San Diego Minimum wage for 2026: $17.75 per Hour Regardless of the number of employees on your payroll.

For Example, the new San Diego minimum wages rates for 2026 in the City of San Diego include a minimum wage of $17.75 per hour, effective January 1, 2026 for ALL employers with employees who perform at least two hours of work in one or more calendar weeks of the year within the geographic boundaries of the City of San Diego.

Pro-Tip: “There are class actions, PAGA wasn’t even heard of in 20 years ago. And now every seminar you hear about is on PAGA defense. There’s sexual harassment, used to be the young, the big game in town. And now you’ve got to check your paycheck stubs to make sure that they’re not spelled wrong or there’s a missed decibel point, or you’re going to get a class action lawsuit filed against you in, in a multitude of ways.

Obviously we have wage and hour disputes. Those are big. They’re everywhere. They’re big in California, they’re big nationally. Well, wage and hour and overtime are similar, but PAGA, a private attorney general claim against the employer is really heating up. There are law firms that just do plaintiff PAGA work, and they send out constant communications to every area of employee you can imagine. And if anyone’s thinking about leaving your employment, they’re going to be tempted to get a little severance pay involuntary.

And then misclassification of independent contractors. California keeps changing the law and the courts keep changing their interpretation of the California law. So yes, they do make it really hard to stay on top of that. Sexual harassment is always a scary thing because you can get sued for sexual harassment and lose, even though no one was actually harassed because you didn’t investigate it correctly or thoroughly. That’s a separate cause of action. Failing to investigate it according to the law, even if your investigation finds out that it was a false claim, which seems terrible, but it’s true. And then discrimination claims are always there. Retaliation again for somebody making a false claim. If you retaliate against them for lying about you and suing and lying about you, you’re still liable for retaliating against a liar. Again, terrible but true. And then general wrongful termination, how people are terminated and whether or not you comply, you can get stuck with 60 days of pay that you inadvertently didn’t know about.

The ones where you can get stuck for attorney’s fees are the ones you’re likely going to see in a lawsuit or a claim against you because the lawyers rarely go after the ones that are only break time, or only mischaracterization of how you write the paycheck.  If it’s not something with an attorney’s fees clause, you’re not going to see it. So let’s, let’s talk about attorney’s fees clauses and common overtime issues.

In a wage and hour dispute, the remedy is often for us fix the wage in the problem if there is one. And we do that rather quickly because we get so many of them every day.

So, let’s say you are the plaintiff’s lawyer, and you’re suing my client. Well the minute my client knows something, he’s going to tell me. I’m going to look at whatever he or she may have been doing, I’m going to fix it. It’s usually like the remedy is to fix the way the paycheck’s written or calculated or the breaks or whatever, I’ll fix it. We’ll tell our clients to pay the employee the extra $500 before the lawyer can file a lawsuit. And so if there’s no breach at the time of the lawsuit, there’s no attorney’s fees and the plaintiff lawyer’s case goes away.  He has no incentive to bring it!” – Dan Watkins, Founding Partner

San Diego Employer Defense Attorneys Remind Area Employers New San Diego Minimum Wage Rates for 2026 Take Effect January 1, 2026

The Watkins Firm provides sound general counsel to all San Diego and California employers to help them to fulfill their legal responsibilities.  Ask about our “Employee Handbook Package” or about our work to review and update your policies and procedures. We work with our clients to help them to avoid PAGA actions, unpaid overtime lawsuits and other employee related litigation.

If you are a San Diego area employer it is important to understand and comply with the new San Diego minimum wage rates for 2026. We invite you to review our podcast Episode 39 – What Keeps Employers Up at Night as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.

Meet Daniel Watkins:

Daniel W. Watkins is a true people person who sincerely listens. He cares deeply about what others are going through.  Dan enjoys digging into the facts and finding creative solutions to problems.  He contributes his insights candidly and constructively.

Dan’s interest in people make him deeply invested in every relationship and his exuberant personality makes him a true litigator. Dan fights for his clients with a fierce and calculated commitment.

Dan has practiced in the areas of business, medical practices and healthcare business, high tech/science, real estate and employment defense law since 1987. He is a trusted litigation strategist and true trial attorney with over 50 jury and bench trials to his credit. Dan has successfully represented both large companies and individuals and achieved substantial victories in well-publicized trials throughout California and the U.S.

He is experienced in business and corporate formation and administration, as well as all forms of alternative dispute resolution, including binding arbitration and mediation.

THE ROAD TO BECOMING A BUSINESS LAWYER AND LITIGATOR

Dan has almost 40 years of experience working with, for and against some of the largest insurance companies in the country. He has successfully tried and litigated cases in the areas of Healthcare Compliance, Commercial Litigation, Unfair Business Practices, Fraud, Breach of Contract, Battery, Premises Liability, Product Defect, Medical Malpractice, Discrimination, Sexual Harassment, Construction Defect, as well as Unfair Competition, Defamation, and Trade Secrets.

In December 2003, Dan commenced litigation against Health South Surgery Centers-West, Inc and its’ subsidiaries, exposing the company’s extensive mismanagement and misconduct of its’ surgery centers. Dan has also been asked by some of California’s largest municipalities and corporations to conduct legally required investigations into matters involving alleged employment discrimination and harassment.