Are You Being Paid Proper Overtime?


By Christopher Brandes
February 19, 2014

Many of the wage and hour cases I have handled in my time as a labor attorney have involved employers who have neglected to pay their employees proper overtime based on inadvertent miscalculations of the correct overtime rate, or employers knowingly breaking the law, not paying their employees overtime in order to save money on overhead. More often than not, the latter occurs, and employees usually do not realize that their employer has failed to pay them proper overtime until well after the employee has been terminated and usually once they have consulted an attorney. This often occurs because employees are not aware of the rights they hold under California’s various wage and hour laws. An additional reason for this oversight is that employees fail to closely examine their payroll stubs each pay period to make sure that everything they are owed is there. Although it would be very convenient for an employee to expect that their employer follows these overtime rules strictly, it is important for each employee to know and understand what he or she is owed under California law and to carefully scrutinize his or her pay stubs. Hopefully, through this article, California employees can gain a better understanding of the overtime wages they are owed under the law.

Wage and hour laws in California are governed by specific statutes contained within the California Labor Code. The State of California’s Department of Industrial Relations is the administration, which by its very own words is, “Established to improve working conditions for California’s wage earners, and to advance opportunities for profitable employment in California.” For me, this government organization, through its website, provides me with a good tool for keeping up to date on California’s various wage and hour laws.

Within the California Labor Code are a number of statutes that lay out the laws which make up the proper hourly wage and appropriate overtime rates employees have a right to in California. There are two important classifications of employees which will determine what rules to follow in regards to overtime compensation, nonexempt and exempt. According to the Department of Industrial Relations’ website:

a nonexempt employee 18 years of age or older, or any minor employee 16 or 17 years of age who is not required by law to attend school and is not otherwise prohibited by law from engaging in the subject work, shall not be employed more than eight hours in any workday or more than 40 hours in any workweek unless he or she receives one and one-half times his or her regular rate of pay for all hours worked over eight hours in any workday and over 40 hours in the workweek. Eight hours of labor constitutes a day’s work, and employment beyond eight hours in any workday or more than six days in any workweek is permissible provided the employee is compensated for the overtime at not less than:

(a) One and one-half times the employee’s regular rate of pay for all hours worked in excess of eight hours up to and including 12 hours in any workday, and for the first eight hours worked on the seventh consecutive day of work in a workweek; and

(b) Double the employee’s regular rate of pay for all hours worked in excess of 12 hours in any workday and for all hours worked in excess of eight on the seventh consecutive day of work in a workweek.

Basically, this means that a nonexempt employee is owed overtime after reaching eight hours of consecutive work in one day, and double overtime after reaching 12 hours of consecutive work in one day. Regular overtime is calculated at one and one-half times the employee’s regular rate of pay and double overtime is calculated at double the employee’s regular rate of pay. With many companies nowadays wanting to increase production by pushing their workers to grind for longer hours, employees are easily dipping into the overtime and double overtime rates.

Certain California employees who are designated as exempt are those who hold jobs in specific “professional industries,” such as in law, medicine, dentistry, optometry, architecture, engineering, teaching or accounting, and employees who are primarily engaged in an occupation commonly recognized as a learned or artistic profession. These types of employees do not have a right to collect overtime compensation under the law. However, there are some situations where employees have been misclassified as exempt and, there, they would be owed overtime wages for hours worked in excess of eight hours in any workday or more than 40 hours in any workweek. This will occur when an employee working within one of the aforementioned “exempt” professions, does not actually hold a position within one of the “professional industries.” In those instances, an employee’s exempt status would not apply and he or she would be owed overtime wages.

As a matter of practice, employees should be very diligent about checking their pay stubs each pay period and re-examining their salary arrangements with their employer. Sometimes employers disguise the fact that they are not paying overtime by compensating their employees at a flat weekly rate. This weekly rate will often be a much lower amount of compensation than the employee would have gained if he or she had been paid hourly, with the appropriate overtime amount. My firm recently settled a case where several employees were being paid under this “flat weekly rate” arrangement. These employees were putting in many more hours than 40 per week, and we’re working well beyond the eight hours per day threshold, which begins the first level of overtime. Unfortunately, the company they worked for was from out of state and was not familiar with the overtime laws in California. Instead of curing its mistake when my clients approached its supervisors about this issue, the company decided to terminate them. This exposed the company to a whole new theory of liability, because, under the law, my clients who complained about “working conditions,” which in this case was their unpaid overtime wages, and were terminated as a result, successfully recovered damages against the company for retaliation.

These are just some of the more common issues regarding California’s overtime laws that employees should look out for. For a more comprehensive explanation of these rules, please visit California’s Department of Industrial Relations’ website section on overtime at Moreover, always contact an attorney if you believe your employment rights have been violated.

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