New York’s 2026 Wage Changes: What Business Owners Need to Know
New York employers are approaching a significant set of wage and salary changes that will take effect on January 1, 2026. These updates mark the final stage of the state’s planned minimum wage increases and signal a shift toward an inflation-indexed model beginning in 2027.
New York’s three-year schedule of minimum wage increases, enacted in 2023, reaches its final phase at the start of the new year. On January 1, 2026, minimum hourly rates will rise to $17.00 an hour in New York City, Westchester, and Long Island, and to $16.00 an hour across the rest of the state.
After this final scheduled increase, future adjustments will no longer follow a fixed timeline. Instead, they will be tied to the three-year average of regional Consumer Price Index (CPI) data. The New York Department of Labor will review the numbers annually and publish any new wage rates by October 1, giving employers time to plan for the year ahead.
These changes stretch beyond hourly employees. Salary thresholds for overtime-exempt workers classified under New York’s executive and administrative exemptions will increase as well. Beginning January 1, 2026, exempt employees must earn at least $1,275.00 per week ($66,300 per year) in New York City, Westchester, and Long Island. The threshold for the rest of the state will shift to $1,199.10 per week ($62,353.20 per year). Any employee who falls below these levels will no longer qualify for exempt status and will need to be reclassified or brought into compliance to avoid unintended overtime liability.
One exemption that will remain unchanged is the professional exemption. New York does not impose a higher state-level threshold in this category, so the federal Fair Labor Standards Act (FLSA) minimum of $684 per week ($35,568 per year) continues to apply.
With these changes approaching quickly, employers should begin reviewing compensation structures, exemption classifications, and budgeting plans for 2026. Taking a proactive approach now will make compliance smoother and help business owners adapt to the ongoing shift toward inflation-based wage adjustments.