California has some of the most comprehensive laws in the nation related to when and how an employer must compensate its employees. In addition to having a higher minimum wage then provided under federal law, California law also requires that employees:
- Be paid overtime after working eight hours in a day or seven days in a row,
- be paid for certain meal and rest breaks,
- In certain cases, be reimbursed for such things as food, lodging, transportation, vacations, sick leave, meals, breaks and the cost of work related supplies.
Employers are required to keep detailed and accurate payroll and personnel records for all its employees. In most cases, employees are entitled to view their payroll records as well as their personnel files upon reasonable request (this may be different for employees covered by a collective bargaining unit, you should check with your union representative or human resources if you are unsure if this applies to you). Employers who fail to provide their employers with the appropriate compensation may be subject to legal action.
What is the Minimum Wage In California?
As of January 1, 2019, the minimum wage in California is $11.00 an hour for employers with fewer than 25 employees, and $12 per hour for employers with 26 or more employees. However, people who are outside salespersons, or the parent, spouse or child of the employer or an apprentice indentured under the State Division of Apprenticeship Standards may be exempt, meaning that they may be paid less than the minimum wage. Additionally, people who are considered “learners” can be paid less than the minimum wage, but no less than 85% of the minimum wage and this exemption applies only during the first 160 hours of work. To be considered a “learner” you must be working in an occupation in which you have no previous similar, or related experience. There are also some exceptions for persons who are either mentally and/or physically disabled and certain non-profit organizations. In these cases, the person or the organization may be issued a special license to pay less than the legal minimum wage.
What Is The Federal Minimum Wage?
Currently, the federal minimum wage is $7.25 an hour and in most cases employers may not pay a wage that is less than the federal minimum.
What is Considered a Workweek in California?
California law defines a workweek as any seven consecutive 24-hour periods that begin with the same calendar day each week. A workweek may begin on any day of the week. Typically, a workweek is from Sunday to Sunday, but under California law it doesn’t have to be.
What Are The Differences Between Federal And California Wage And Hour Laws?
In addition to having a higher minimum wage, California provides workers significantly more benefits and protections then they are provided under federal law. Some important differences are:
- California has a much higher minimum wage,
- California does not allow ‘use it or lose it’ vacation pay rules,
- Tips cannot be counted against your wages,
- Employees are entitled to overtime after working 8 hours in one day,
- Employees exempt from overtime must make more than two times the minimum wage (discussed below).
What Are Some Ways That California Employers Violate Wage and Hour Laws?
Some of the most common ways that California employers violate wage and hour laws are:
- Paying the federal minimum wage and not the California minimum wage,
- Paying a “salary” that averages out to be less than the minimum wage,
- Not paying commissioned employees the appropriate rate,
- Paying a lower wage to employees that receive tips or deducting tips from their wages,
- Not paying employees for all of the hours they have worked (this includes failing to pay for breaks),
- Failing to pay employees according to California’s overtime laws,
- Classifying employees as independent contractors instead of employees,
- Misclassifying employees in order to avoid paying overtime.
Which Minimum Wage Applies To Me, The Federal Or The California Minimum Wage?
In general, the wage that is most favorable to the employee is the wage that the employee must be paid, unless the employee is exempt under the Fair Labor Standards Act (FLSA). However, California employers, who are not otherwise exempt, must pay the higher of either the California minimum wage or the minimum wage of the locality in which they are located (For example, San Francisco has a minimum wage of $12.25 per hour, so employers located in San Francisco must pay employees $12.25 an hour). If you are being paid at a rate lower than what you believe you are entitled to, you should speak with an attorney to discuss your options.
How Does The Minimum Wage Apply To Me If I Am A Salaried Employee?
Employees who are paid a salary in California fall under the so-called “white collar” rule, and are considered exempt from certain overtime provisions. California has a much stricter standard than federal law for how much salaried employees are paid. Under California law, a salaried employee must be paid the equivalent of at least twice the minimum wage, which translates into a minimum salary of $41,600 per year. However, federal law only requires that a salaried employee be paid $455 a week.
How Does The Minimum Wage Apply To Me If I Am A Commissioned Employee?
Like salaried employees, employees who work for a commission may be exempt from overtime wages. In order to meet this exemption, the employee must make 1.5 times the minimum wage rate for all hours worked during each pay period and more than half of those wages must be made from commissions. After January 1, 2016, the minimum rate a commissioned employee can make is $15.01 an hour.
Can My Employer Deduct My Tips From My Wage or Pay Me Less Than Minimum Wage?
No. In California, your employer must still pay you the minimum wage. Unlike federal law, where an employer can use tips as a credit against what it owes you, California requires employers to pay its employees at least the minimum wage and tips cannot be considered a part of your wages. Accordingly, It is illegal for a California employer to deduct tips from your paycheck or consider tips as part of your pay, whether the pay is for overtime or for regular work hours. Your employer can require you to pool tips or share tips with the busboys, bartenders and other employees. However, tips may not be shared with the owners, the supervisors or the managers of the business, even if these people provide wait services to the customers.
Other Important information related to tips:
- Because tips are a gratuity and are not considered as part of your regular pay, employers do not have to count tips when calculating the amount of overtime you are to receive.
- When a customer includes a tip when paying with credit cards, the employer cannot deduct the cost of the credit card processing fees from the employee’s paycheck.
- Tips paid with credit cards should be paid to the employee no later than the next regular payday following the date the tip was paid.
- Mandatory service charges are not considered tips or a gratuity. Tips are considered voluntary, where a mandatory service charge is not. Accordingly, the way the mandatory service charge is distributed among employees is at the discretion of the employer and such extra pay would be considered a bonus rather than a tip.
What should I do if My Employer is Deducting Tips from My Wages?
If your employer is deducting tips from your wages, charging you for credit card fees, or otherwise not paying you fairly, you should file a wage claim and speak to an attorney.
Is My Employer Required to Pay Me From The Time I Arrive or When I Start Working?
That depends. Both Federal and California law provide that all work time that is “suffered or permitted” by an employer is compensable work time. Under California law compensable work time is any time that an employee is “subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so.” See, e.g. Wage Order No. 1-2001, §2(g) (8 Cal Code Regs §11010(2)(G)). However, when exactly an employee is “suffered or permitted” to work is not always very clear. Generally, the actual job you do is considered a “principal activity” and the Supreme Court has stated that any activity that is “integral and indispensable” to a “principal activity” is itself a “principal activity.” Accordingly, anything that you do related to your job that is considered “integral and indispensable” should be paid for, this may include such things as walking to and from your first job activity (an example is walking to a service counter after clocking in), but may not include changing into a work uniform.
Following are some other examples:
- Putting on uniforms that include special equipment: the court has found that putting on uniforms, including some protective gear is not integral and indispensable, but putting on protective gear that is required by law is and any time spent in this activity must be paid;
- Showering and dressing: showering and dressing is not considered integral and indispensable unless the showers are required,
- Traveling time: traveling to and from the first job site is generally not integral and indispensable, but if the employee is required to send in reports after getting home, then that time is integral and indispensable and must be paid;
- Regularly scheduled work time, but no work is provided: generally considered integral and indispensable;
- On-call, callback and stand-by time: depends on the circumstances (discussed below).
The rule of thumb is whether or not the activity is integral and indispensable or whether the activity is de minimus (doesn’t take a lot of time). When determining if the activity is de minimus, the court looks at three things: (1) the practical administrative difficulty of recording the additional time; (2) the aggregate amount of compensable time, and (3) the regularity with which the additional work was performed. See also Kellar v. Summit Seating, Inc. (7th Cir 2012) 664 F3d 169.
Obviously, wage and hour law can be very complicated and there are certain employment related activities, which are considered integral and indispensable, which the state requires employers to pay for and other activities that are substantially similar, but are not paid. If you engage in an activity at work or for your job and you are unclear if you should be paid for that activity, you should talk to a qualified attorney to find out what your options, if any, are.
Can I Be Compensated for Meals and Break Times?
California law requires employers to provide employees with meal and/ or breaks. If you have worked more than five hours your employer must provide you with one unpaid and uninterrupted 30-minute break, a second break is required after working ten hours. Employees who work more than four hours or a major portion of 4 hours are entitled to a paid 10-minute break. Rest breaks are mandatory and may not be waived or abridged by contract. However, employees can decide to forego taking a rest, but the employer must “authorize and permit” them.
What If My Employer Requires Me To Spend Nights On The Job Or To Be On-Call?
Generally, anytime you are at work and are required to be at work you are entitled to be compensated. This includes times when you are asleep or on-call. However, whether or not on-call or spending the night at the job location are eligible for reimbursement depends on how much control your employer has over you in these situations. The more control, the more likely he is required to compensate you. In determining what criteria to evaluate for how much control the employer has over the employee, the court looks to such things as:
- an on-premise living requirement;
- excessive geographical restrictions on movement;
- whether the frequency of calls is unduly restrictive;
- whether a fixed time limit for response was unduly restrictive;
- whether the on-call employee could easily trade on-call responsibilities;
- if using a pager could ease restrictions;
- whether the employee had actually engaged in personal activities during the call-in time, and
- if the on-call waiting time. . . is spent primarily for the benefit of the employer and its business.
Mendiola v. CPS Security Solutions, Inc. et at., No S212704 (Cal. Jan 8, 2015). This list, however, is not determinative and you should speak to an attorney regarding your specific situation.
When Does My Employer Have to Pay me Overtime?
California law has an overtime requirement for both daily overtime and weekly overtime. Under California law, an employer is required to pay employees time and a half of overtime for:
- all hours that were worked over 40 hours in a workweek,
- all hours worked in excess of 8 hours in one workday,
- the first 8 hours worked on the 7th consecutive day of work in a workweek.
If an employee works more than 12 hours in one day or more than 8 hours on the seventh consecutive day of work, the employer must reimburse the employee at two times his rate of pay. However, there are some employees, such as employees who are part of a collective bargaining agreement, who are exempt from these provisions. If you are unsure if California overtime laws apply to you, you should check any employment agreement that you have or consult a reputable attorney.
What Is The Difference Between An Independent Contractors And A Regular Employee?
An independent contractor is a person who is in business for him or herself and is, therefore, exempt from California’s wage and hour laws. For this reason, some employers will hire an employee and tell them they will be considered independent contractors. However, there is a significant difference between independent contractors and regular employees. An independent contractor decides their rate of pay, the hours they will work, how to complete the work assigned and whom they will work for. If your employer told you that you are an independent contractor, but treats you like a regular employee you may be entitled to be compensated for any hours and wages that you would have been paid as a regular employee.
How Do I Know if My Employer Has Misclassified My Employment Status?
If your actual job and amount of pay are inconsistent with what is required under California law, your employer may have misclassified your employment status. For example, if you make a salary of $35,000 a year and are not paid overtime, then you may be misclassified; or if your employer has classified you as an independent contractor, but you have no control over how and when you work, you may be misclassified. It is important that you ascertain your right job classification if you want to ensure that you are being paid appropriately.
What Should I Do If I Believe That I Am Not Being Fairly Compensated?
If you believe that you are not being fairly compensated, you should file a wage claim and contact a reputable and knowledgeable attorney, such as the attorneys at David Yeremian & Associates, Inc.
How to File a Wage Claim in California
What is a Wage Claim?
A wage claim is a legal claim that is filed by an employee to recover any:
- Unpaid wages, including overtime and bonuses,
- Wages that were not received because your employer did not have enough money to cover the check,
- Payment for any unused vacation time or sick time,
- Reimbursement for unauthorized deductions and other compensable business expenses.
In addition to making a claim for any unpaid money owed, employees can also file a wage claim to receive reimbursement for any penalties that may be owed for an employer’s failure to pay a final paycheck in a timely fashion, failure to pay the minimum wage for each hour worked, and any penalties that may have accrued due to a bounced check.
How Do I file a Wage Claim?
An employee must file a wage claim with the local office of the DLSE (Division of Labor Standards Enforcement). Filing the claim will start an investigation into your claim. When you file the claim be sure to provide the DLSE with all of the information that you have available. Include your legal name, location, and status, where you worked and the type of business you worked for.
Additionally you should provide:
- time records of the hours and dates you worked,
- any paychecks and pay stubs that show the amount of money you were paid,
- any checks that bounced or were dishonored,
- The notice of employment information (this is a notification that all employees must be provided (after January 1, 2012,) showing the amount of pay, any overtime rate of pay, your basic employment information, and how you were paid (hourly, day, week, monthly, etc.),
Note: your employer is required to keep detailed accurate records of your employment, you are not required to provide these records, but it helps the DLSE to better understand your situation.
What Happens After I file a Claim?
After you file your claim, the DLSE will appoint a deputy to make a decision on what procedures, if any, should be taken. Within 30 days, a determination will be made as to which of three different actions will be taken. The deputy will advise all parties to the claim whether the claim will be:
- referred to conference,
- referred to a hearing, or
What is a Conference?
A conference is an informal procedure both parties must attend to discuss the merits of the claim and determine if a resolution can be achieved without proceeding to a hearing. If the case cannot be resolved, then the deputy determines if either a hearing or dismissal is warranted.
What is a hearing?
A hearing is a formal procedure where both parties are required to testify under oath. Parties are entitled to be represented by counsel, testify, present evidence, have witnesses testify, cross-examine the other party’s witnesses and explain any evidence offered. The hearing officer will make a determination on the case based on the facts and evidence presented at the hearing. (However, it is important to understand that hearing officers are given wide latitude in making determinations and whether or not to accept any evidence presented at the hearings. Additionally, hearing officers have discretion in whether or not penalties are appropriate. ) After hearing the case, the hearing officer will issue a decision, usually within 15 days of the hearing. The decision is officially called the Order, Decision or Award, or ODA.
What if I don’t Agree With the Hearing Officer’s Decision?
Both parties to the case are entitled to appeal the decision of the hearing officer if they don’t agree with it. If you want to appeal you should get a Notice of Appeal from the DLSE office. Your appeal must be filed in the appropriate court and in a timely manner. The amount of time you have to appeal will be listed on the ODA.
Why Should I Contact An Attorney?
Wage and hour law is extremely complicated and has many different aspects. A knowledgeable attorney is better suited to ensure that your rights are protected and that any violations being made by your employer are adequately and competently addressed. Employers who violate wage and hour laws should be held responsible for their actions.
The attorneys at David Yeremian & Associates, Inc. are dedicated to enforcing the wage and hour law as outlined by the state of California. We will be able to answer any questions you have, while assessing your personal circumstances to ensure you are receiving every benefit of being employed in California. It is our goal to deliver the best possible argument on your behalf in court.