Wage and Overtime
CALIFORNIA MINIMUM WAGE
California labor laws are working to raise the minimum wage for workers, and helping to spur discussion about the national minimum wage. So it's more important now than ever before to know your rights and make sure your employer is paying what they owe.
As of January 1st, 2016, the California minimum wage is $10.00 per hour. The minimum wage in Los Angeles, and in unincorportated parts of LA county, raises to $10.50 on July 1st, 2016, and is scheduled to hit $15 by 2022.
It doesn't stop there, state legislation and popular ballot measures have made it almost a guarantee that the CA minimum wage will rise up to $15, but the schedule depends on which piece of legislation becomes law.
OVERTIME AND DOUBLETIME PAY
California overtime law prohibits employers from working an employee for more than eight hours per workday and for more than forty hours per workweek without paying premium overtime rates. California labor law requires an employer to pay an overtime rate of 1.5 times an employee’s regular hourly pay rate if they work more than eight hours in a single workday. Furthermore, an employer is required to pay an overtime rate of double an employee’s regular hourly pay rate if they work more than 12 hours in a single workday.
Similar rules also apply when an employer requires you to work beyond the normal working week. For instance, an employee can be made to work more than six days per week if he/she is paid at 1.5 times the normal wage for the first eight hours of the seventh working day and double the regular rate of pay for work in excess of eight hours on the seventh working day. Employers are also responsible to pay premium rates for all overtime worked, whether or not overtime was approved by management.
Excepting industries with specific regulations and union agreements, the Fair Labor Standards Act does not limit the number of hours that can be worked in a day nor does it regulate the total number of hours that an employee can be made to work per week. Specific industries, particularly commercial transport and healthcare, have OSHA and union regulations that limit the work day and work week for health and safety reasons.
Some common schemes that employers use to avoid paying overtime are to misclassify employees as exempt administrators or as independent contractors. They may say that you didn’t get permission to work overtime and therefore, they don’t have to pay you for your additional hours. Working off the clock is common in the restaurant industry, retail establishments, and sales and customer service jobs.
If an employer violates california overtime law, an employee is entitled to recover the lost wages by filing a claim against the employer for backpay, penalties, interest, and any undue suffering.
EXEMPT VS. NON EXEMPT
Very recently, the white house and the department of labor announced changes to DOL policy that effectively raise the minimum income threshold to qualify for overtime. Prior to Dec. 1, 2016 (when the new policy takes effect) salaried employees making more than $23,660 were generally ineligible for overtime pay. After Dec. 1, 2016 that threshold will be raised to $47,476,opening the way for millions of salaried employees to collect overtime pay. This policy will go into effect nationally, but until it does local and state laws still apply.
In this state, the California Labor Code and federal Fair Labor Standards Act govern most jobs. Under these labor laws, employees are considered either “exempt” or “non exempt.” Employees that are non exempt are entitled to overtime pay and meal and rest periods, while employees who are exempt are not entitled to overtime pay.
Exempt employees are typically supervisors, managers, executives, “outside” salesmen, licensed professionals, administrators, or other high-level workers whose work requires independent judgment. In addition to performing duties in one of these categories, in order to be unambiguously exempt, you must make about $30,000 per year. If you do not fit into any of these categories, you are likely non exempt and therefore eligible for overtime pay and meal and rest breaks.
A common misconception is that, if you are paid on a salary basis, then you are exempt. That is not necessarily true. Many workers who are paid on a salary basis do not perform the kind of high-level job duties that meet the exemptions specified by California labor law and the federal Fair Labor Standards Act.
MEAL AND REST BREAKS
In this state, hourly paid employees must receive an unpaid 30 minute meal period if they work more than 5 hours, and must receive a paid 10 minute rest break for every 4 hours of work. In addition, a shift of more than 10 hours gives employees the right to a second meal break. Some employers say they allow rest breaks, but in practice make it impossible for employees to take them.
But don't be bullied by an unscrupulous employer into not taking the breaks you deserve. It is against the law for a supervisor to restrict you from taking a lunch break, it is even against the law for an employer to coerce you into working through your lunch. You are legally entitled to a minimum 30-minute uninterrupted meal break for every 5 hours you work. Your employer is also responsible for making employees aware of when they're able to take breaks and how often they should take them. If an employee simply does not take their lunch, depsite encouragement to do so, then the company will not be held responsible.
INDEPENDENT CONTRACTOR / EMPLOYEE MISCLASSIFICATION
Misclassification of employees as independent contractors is a serious problem for today's workers. With one in three American workers classified as a freelancer, it is important to be able to recognize when an employer has misclassified you as an independent contractor. This practice deprives employees of overtime, minimum wages and other benefits. As a litmus test, if an employer tells you when, where and how to do your job, then you are an employee and not a contractor.
According to a meta analysis done by Center for Social Policy at the University of Massachusetts, ten to twenty percent of employers misclassify at least one worker. One of the most famous, recent instances of widespread employee misclassification is with the popular rideshare service Uber. The debate over whether or not the rideshare drivers count as employees is still being debated. In one case, however, the California Labor Commissioner determined that the company had been misclassifying one of its drivers, applying the economic realities test adopted by the state Supreme Court in S. G. Borello & Sons, Inc. v. Department of Industrial Relations.
An employee’s hourly rate of pay must include all compensation except for gifts, discretionary bonuses, and payments not made as compensation for employment when calculating overtime. In addition, hourly paid employees must receive an unpaid 30-minute meal period if they work more than 5 hours, and must receive a paid 10-minute rest break for every 4 hours of work (or major fraction thereof)
This is why it's essential to stay on top of developments as they happen. Don't let an unscrupulous employer use wage hikes as an excuse not to compensate you properly. And remember, if the city in which you work has a higher minimum wage than the state minimum, your employer is required to pay you at the higher rate.
In California, unlike many other states, it is against the law to pay a tipped employee less than the minimum wage before tips. Restaurant owners, for instance, must fulfill their minimum wage obligation before paying out tips to the waitstaff. If you have a supervisor who tells you otherwise, then they are either ignorant of the law or are trying to keep money that's fairly owed to you.
A wage is not a gift from your employer, it's a debt for your hard work and effort. So don't be afraid to speak up if an employer shortchanges you. Legally, an employer can't punish you for bringing up a concern about your compensation, although some might try to intimidate you out of making a fuss, or try to punish you when you do speak up.
You may even be fired by a boss who thinks they don't have to pay you. But your boss is wrong, the law makes it very clear what constiutes intimidation and retaliation; and punishing an employee who brings up a wage dispute, or makes a claim with the department of labor, is against the law.