As of January 1, 2026, an increase in pay rates for physicians and computer software employees to be exempt from overtime is in effect, as is the minimum salary for administrative, professional, and executive workers. It was announced by the California Department of Industrial Relations (DIR) under the California Labor Code Sections 515.5 and 515.6. To qualify for exemption from overtime requirements, the following rates apply:

• Computer software employees must be paid on a salary or hourly basis and earn at least $58.85 per hour or $10,214.44 (per month) / $122,573.13 (per year)
• Physicians must be paid at least $107.17 per hour.
• Administrative, professional, and executive workers must be paid at least $70.34 per hour or $1,352 (per week) / $5,858.67 (per month) / $70,304 (per year).

This article is informational and does not constitute legal or financial advice. Consult with an employment lawyer or accountant for additional clarification on how these changes impact your company.