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Find out how Remote can guide you through the complexities of managing cross-border hiring, payroll, taxes, and compliance.

Employing in California

In California, workers’ rights are protected by numerous employment and labour laws, at both the state and federal level. As a result, employees enjoy protection from discrimination based on age, religion, sexual orientation, gender, and race.

Here are the key things you need to know about hiring in California.

Hours of work in California

The regulations and edicts around working hours and overtime are primarily covered by the California Labour Code.

What is considered full-time employment in California?

Full-time employment is generally considered to be 40 hours per week.

Do pay employees get overtime in California?

Non-exempt employees are entitled to overtime pay of:

  • 1.5x their regular pay rate if they work more than eight hours (but less than 12) in a workday
  • Double their regular pay rate if they work more than 12 hours in a workday

Under the federal Fair Labour Standards Act, employees are generally (but not always) exempt from overtime if they:

  • Earn more than the state or federal exemption threshold
  • Perform a role with duties that are
  • Work in a certified or licensed profession, such as law, accounting, architecture, or engineering

In California, the monthly pay threshold for exemption is currently $5,373.33.

Note that the federal pay threshold for exemption is currently being reviewed in the US.

Minimum wage in California

The minimum state wage is $16 per hour. However, cities are entitled to set their own minimum rates. In some of California’s biggest urban centers, for instance, the 2023 minimum hourly rates are as follows:

  • Los Angeles: $16.78
  • Pasadena: $16.93
  • San Diego: $16.30
  • San Francisco: $18.07
  • San Jose: $17

Note that, for “small” employers (i.e. businesses with 25 or fewer employees), minimum rates can be lower.

Onboarding timeline in California

We can help you get your new employee started in California fast, with a minimum onboarding time (MOT) of just 2 working days. Note that the MOT is dependent upon registration with the local authorities, and begins after the employee has submitted all the required information on the Remote platform.

For non-citizens of the US, a work eligibility assessment may be required, and can add three extra days to the onboarding time. If a follow-up is needed, there may be additional delays.

Please note that payroll cut-off dates can impact the actual first day of employment. Remote’s payroll cut-off date is the 10th of the month, unless otherwise specified.

Payroll cycle in California

Under state law, employees must be paid at least once per month (employees in some occupations must be paid more frequently). Private sector salaries are usually paid twice per month. 

For Remote customers, employee payments are made twice per month in equal instalments, payable in arrears. The first payment is made on the 15th of the month and the second payment is made on the final day of the month. If relevant, bonus payments, commissions, and expense reimbursements are included in the second payment of the cycle.

Competitive benefits package in California

Remote can help you craft a competitive benefits package to attract and retain the best global talent. Our benefits experts understand the trends, requirements, and expectations of the California labour market, allowing your employees to feel appreciated and thrive.

Our benefits packages in California usually include some or all of the following:

pension_or_401(k)
Pension or 401(K)
medical_insurance
Medical Insurance
vision_insurance
Vision Insurance
dental_insurance
Dental Insurance
life_insurance
Life Insurance
health_saving_plan_(hsa)
Health Saving Plan (HSA)
long_term_disability_insurance_(ltd)
Long term disability insurance (LTD)
flexible_spending_account_(fsa)
Flexible Spending Account (FSA)

Are employers required to provide health insurance in California?

Under the Affordable Care Act, organizations with a headcount of 50 or more must offer statutory health insurance to their full-time employees.

Most employers also offer some level of supplemental health insurance. While this can lead to a relative rise in employment costs, it’s an essential benefit that ensures your people have access to routine care and are covered in the event of an emergency. 

Because Remote is the employer of record (EOR), it’s important for us to offer the same core benefits to all employees to ensure fair and non-discriminatory hiring practices. This protects both your business and ours.

Note that we do not add a markup on any benefits premiums or administration costs.

Do part-time employees get benefits in California?

Organizations with fewer than 50 employees are not required to offer health insurance to their part-time employees. However, if you offer health coverage to one part-time employee, you must offer group coverage to all your part-time team members.

Are employers required to offer 401k in California?

Yes. Organizations must offer a retirement plan to their employees. You can either choose your own qualified savings plan, or enroll your employees into the state-sponsored CalSavers Program.

Note that this only applies if your business:

Failure to enroll can result in a fine of $250 per employee after the first 90 days, and $500 per employee after 180 days.

Facts & Stats

Spread along 840 miles of stunning Pacific coastline, California offers a diverse landscape of sprawling urban centers, sun-soaked beaches, and towering redwood forests.

But it's not just the breathtaking scenery that sets the Golden State apart. From the glitz and glamour of Hollywood to the tech revolution of Silicon Valley, California has always been synonymous with innovation and progress. With a rich cultural heritage that celebrates diversity and creativity, this vibrant state is the definition of opportunity — making it a hugely desirable destination for top talent and companies alike.

Capital City
Sacramento
Currency
United States Dollar
($, USD)
Population size
39,200,000
VAT - standard rate
7.25% (Higher in some cities)

Grow your team in California with Remote

If you want to hire in California, you’ll need to own a legal entity there — or partner with a global employment solutions provider, like Remote.  

We can employ top talent in California on your behalf and manage complex HR tasks such as onboarding, payroll, benefits, and taxes. You can also pay and manage your contractors in California through Remote.

Risks of misclassification

California, like many other countries, treats self-employed individuals or contractors and full-time employees differently. Misclassification of contractors in California may lead to fines and penalties for the offending company.

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Fair Pricing in California

Payroll

29

per employee/month
Book a demo
  • Powerful, transparent international payroll
  • Simple self-service platform
  • Personalised support from dedicated specialists
  • Adhere to local payroll regulations in every country
  • Integrated payroll, expense management, and HRIS solution
Contractor Management

29

per contractor/month
Book a demo
  • Only pay for contractors you actively work with
  • Work with international contractors
  • Create, edit, and sign tailored, localised contracts
  • Approve contractor invoices with one click or auto-pay
  • Transparent payments with complete visibility
Employer of Record

699 599

per contractor/month
Book a demo
  • Hire without opening a local entity
  • Guided onboarding
  • Local payroll paid on time, every time
  • Built-in security and compliance
  • Flexible, localised benefits
  • Offer equity incentives with tax assistance
  • Dedicated experts for local support
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