Overtime
In California,
the general overtime provisions are that 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:
- One and one-half times
the employee's regular rate or 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
- Double the employee's regular
rate or 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.
There are, however, a number
of exemptions
from the overtime law. An "exemption" means that the
overtime law does not apply to a particular classification
of employees. There are also a number of exceptions
to the general overtime law stated above. An "exception" means
that overtime is paid to a certain classification of employees
on a basis that differs from that stated above.
Q-1.
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What
is the "regular rate of pay," and how is it determined? |
Ans.
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Overtime is based on the
regular rate of pay, which is the compensation you normally
earn for the work you perform. The regular rate of pay
includes a number of different kinds of remuneration,
such as hourly earnings, salary, piecework earnings,
and commissions. In no case may the regular rate of
pay be less than the applicable minimum
wage.
Ordinarily, the hours to be used in computing the regular
rate of pay may not exceed the legal maximum regular
hours which, in most cases, is 8 hours per workday,
40 hours per workweek.
This maximum may also be affected by the number of days
one works in a workweek. It is important to determine
what maximum is legal in each case. The alternate method
of scheduling and computing overtime under most Industrial
Welfare Commission Wage Orders, based on an alternative
workweek schedule of four 10-hour days or three
12-hour days does not affect the regular rate of pay,
which in this case also would be computed on the basis
of 40 hours per workweek.
The agreed upon regular hours must be used if they are
less than the legal maximum regular hours. For
example, if you work 32 to 38 hours each week, there
is an agreed workweek of 35 hours, and thirty-five hours
is the figure used to determine the regular rate of
pay. However, in circumstances where the workweek is
less than 40 hours, the law does not require payment
of the overtime premium unless the employee works more
than eight hours in a workday or more than 40 hours
in a workweek. In other words, assuming you are employed
under a policy that provides for a 35-hour workweek,
the law does not require the employer to pay the overtime
premium until after 40 hours in a workweek. If you work
more than 35 but fewer than 40 hours in a workweek,
you will be entitled to be paid for the extra hours
at your regular rate of pay, as overtime premium pay
is only required after 40 hours in a workweek.
The following are examples of how to calculate the regular
rate of pay:
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- If you are paid on
an hourly basis, that amount is the regular
rate of pay.
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If you are paid a
salary, the regular rate is determined as
follows:
- Multiply the monthly
remuneration by 12 (months) to get the annual
salary.
- Divide the annual
salary by 52 (weeks) to get the weekly salary.
- Divide the weekly
salary by the number of legal maximum regular
hours (40) to get the regular hourly rate.
- If you are paid by
the piece or commission, either of the following
methods may be used to determine the regular rate
of pay for purposes of computing overtime:
The piece or commission
rate is used as the regular rate and you are paid
one and one-half this rate for production during
the first four overtime hours in a workday, and
double time for all hours worked beyond 12 in
a workday; or
Divide your total
earnings for the workweek, including earnings
during overtime hours, by the total hours worked
during the workweek, including the overtime hours.
For each overtime hour worked you are entitled
to an additional one-half the regular rate for
hours requiring time and one-half, and to the
full rate for hours requiring double time.
A group rate for
piece workers is an acceptable method for computing
the regular rate of pay. In using this method, the
total number of pieces produced by the group is
divided by the number of people in the group, with
each person being paid accordingly. The regular
rate for each worker is determined by dividing the
pay received by the number of hours worked. The
regular rate cannot be less than the minimum wage.
- If you are paid two
or more rates by the same employer during the
workweek, the regular rate is the "weighted
average" which is determined by dividing your total
earnings for the workweek, including earnings during
overtime hours, by the total hours worked during the
workweek, including the overtime hours. For example,
if you work 32 hours at $9.00 an hour and 10 hours
during the same workweek at $7.00 an hour, your weighted
average (and thus the regular rate for that workweek)
is $8.52. This is calculated by adding your $358 straight
time pay for the workweek ((32hours x $9.00/hour)
+ (10 hours x $7.00/hour) = $358) and dividing it
by the 42 hours you worked.
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Q-2.
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If
an employee works unauthorized overtime is the employer
obligated to pay for it? |
Ans.
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Yes, California law requires
that employers pay overtime, whether authorized or not,
at the rate of one and one-half times the employee's
regular rate of pay for all hours worked in excess of
eight up to an including 12 hours in any workday, and
for the first eight hours of work on the seventh consecutive
day of work in a workweek, and double the employee's
regular rate of pay for all hours worked in excess of
12 in any workday and for all hours worked in excess
of eight on the seventh consecutive day of work in a
workweek.
An employer can discipline an employee if he or she
violates the employer’s policy of working overtime without
the required authorization. However, California's wage
and hour laws require that the employee be compensated
for any hours he or she is "suffered or permitted to
work, whether or not required to do so." California
case law holds that "suffer or permit" means work the
employer knew or should have known about. Thus, an employee
cannot deliberately prevent the employer from obtaining
knowledge of the unauthorized overtime worked, and come
back later to claim recovery. The employer must have
the opportunity to obey the law.
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Q-3.
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Is
a bonus
included in the regular rate of pay for purposes of calculating
overtime? |
Ans.
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Yes, if it is a nondiscretionary
bonus. A nondiscretionary bonus is included in determining
the regular rate of pay for computing overtime when
it is based upon hours worked, production or proficiency.
Discretionary bonuses or sums paid as gifts at a holiday
or other special occasions, such as a reward for good
service, which are not measured by or dependent upon
hours worked, production or efficiency, are not included
for purposes of determining the regular rate of pay.
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Q-4.
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Are
any amounts excluded from the regular rate of pay? |
Ans.
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Yes,
there are certain types of payments that are excluded
from the regular rate of pay. Examples of some of the
more common exclusions are sums paid as gifts for special
occasions, expense reimbursements, payments made for occasional
periods when no work is performed due to vacation, holiday,
illness, failure of the employer to provide sufficient
work, premium pay for Saturday, Sunday, or holiday work,
and discretionary bonuses. |
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Q-5.
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Are
salaried employees entitled to overtime? |
Ans.
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It
depends. A salaried employee must be paid overtime unless
they meet the test for exempt
status as defined by federal and state laws, or unless
they are specifically exempted
from overtime by the provisions of one of the Industrial
Welfare Commission Wage Orders regulating wages, hours
and working conditions. |
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Q-6.
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How
is overtime calculated if I work at different rates of
pay in the same workweek? |
Ans.
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If you are paid two or
more rates by the same employer during the workweek,
the regular rate is the "weighted average" which is
determined by dividing your total earnings for the workweek,
including earnings during overtime hours, by the total
hours worked during the workweek, including the overtime
hours. For example, if you work 32 hours at $9.00 an
hour and 10 hours during the same workweek at $7.00
an hour, the weighted average (and thus the regular
rate for that workweek) is $8.52. This is calculated
by adding your $358 straight time pay for the workweek
((32hours x $9.00/hour) + (10 hours x $7.00/hour) =
$358) and dividing it by the 42 hours you worked.
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Q-7.
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Can
an employer require an employee to work overtime? |
Ans.
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Yes, an employer may dictate
the employee's work schedule and hours. Additionally,
under most circumstances the employer may discipline
an employee, up to and including termination, if the
employee refuses to work scheduled overtime.
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Q-8.
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Last
week I worked Monday, Tuesday, Wednesday, Thursday and
Saturday, eight hours each day. I was out ill all day
Friday. For the workweek I was paid 48 hours at my regular
hourly rate. Am I entitled to eight hours of overtime
pay? |
Ans.
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No,
you are not entitled to any overtime pay. Overtime is
calculated based on hours actually worked, and you worked
only 40 hours during the workweek.
Another example of where you get paid your regular wages
but the time is not counted towards overtime is if you
get paid for a holiday but do not work that day. In such
a case, the time upon which the holiday pay is based does
not count as hours
worked for purposes of determining overtime because
no work was performed. |
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Q-9.
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When
must I be paid for the overtime hours I work? |
Ans.
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Overtime
wages must be paid no later than the payday for the next
regular payroll period after which the overtime wages
were earned. Labor
Code Section 204 Only the payment of overtime wages
may be delayed to the payday of the next following payroll
period as the straight time wages must still be paid within
the time set forth in the applicable Labor Code section
in the pay period in which they were earned; or, in the
case of employees who are paid on a weekly, biweekly,
or semimonthly basis, not more than seven calendar days
following the close of the payroll period. |
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Q-10.
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Can
an employee waive his or her right to overtime compensation? |
Ans.
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No,
California law requires that an employee be paid all overtime
compensation notwithstanding any agreement to work for
a lesser wage. Consequently, such an agreement or "waiver"
will not prevent an employee from recovering the difference
between the wages paid the employee and the overtime compensation
he or she is entitled to receive. Labor
Code Section 1194 |
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Q-11.
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What
can I do if my employer doesn’t pay me my overtime wages? |
Ans.
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You
can either file
a wage claim eve with the Division of Labor Standards
Enforcement (the Labor Commissioner's Office), or you
can file a lawsuit in court against your employer in to
recover the lost wages. Additionally, if you no longer
work for this employer, you can make a claim for the waiting
time penalty pursuant to Labor
Code Section 203. |
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Q-12.
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What
is the procedure that is followed after I file a wage
claim? |
Ans.
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After your claim is completed
and filed with a local office of the Division of Labor
Standards Enforcement (DLSE), it will be assigned to
a Deputy Labor Commissioner who will determine, based
upon the circumstances of the claim and information
presented, how best to proceed. Initial action taken
regarding the claim can be (i) referral to a conference,
(ii) referral to a hearing, or (iii) dismissal of the
claim.
If the decision
is to hold a conference, the parties will be notified
by mail of the date, time and place of the conference.
The purpose of the conference is to determine the validity
of the claim, and to see if the claim can be resolved
without a hearing. If the claim is not resolved at the
conference, the next step usually is to refer the matter
to a hearing or dismiss it for lack of evidence.
At the hearing the
parties and witnesses testify under oath, and the proceeding
is recorded. After the hearing, an Order, Decision,
or Award (ODA) of the Labor Commissioner will be served
on the parties.
Either party may
appeal the ODA to a civil court of competent jurisdiction.
The court will set the matter for trial, with each party
having the opportunity to present evidence and witnesses.
The evidence and testimony presented at the Labor Commissioner’s
hearing will not be the basis for the court’s decision.
In the case of an appeal by the employer, DLSE may represent
an employee who is financially unable to afford counsel
in the court proceeding.
See the Policies
and Procedures of Wage Claim Processing pamphlet
for more detail on the wage claim process procedure.
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Q-13.
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What
can I do if I prevail at the hearing and the employer
doesn’t pay or appeal the Order, Decision, or Award? |
Ans.
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When
the Order, Decision, or Award (ODA) is in the employee's
favor and there is no appeal, and the employer does not
pay the ODA, the Division of Labor Standards Enforcement
(DLSE) will have the court to enter the ODA as a judgment
against the employer. This judgment has the same force
and effect as any other money judgment entered by the
court. Consequently, you may either try to collect the
judgment yourself or you can assign it to DLSE. |
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Q-14.
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What
can I do if my employer retaliates against me because
I told him I was going to file a wage claim for unpaid
overtime? |
Ans.
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If
your employer discriminates or retaliates against you
in any manner whatsoever, for example, he discharges you
because you file a wage claim or threaten to file a wage
claim with the Labor Commissioner, you can file
a discrimination/retaliation complaint with the Labor
Commissioner’s Office. In the alternative, you can file
a lawsuit in court against your employer. |
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