The state and federal governments recognize that due to the economic position of the average worker and to create a stable job environment, the employer-employee relationship must be a governed by a comprehensive body of rules.

California law requires employers to pay overtime premiums to employees who work more than eight hours per day or 40 hours per week.  Depending on hours worked, overtime premiums are 1-1/2 times or double the employee’s regular rate of pay. 

Not all workers are subject to overtime requirements. For example, independent contractors, professionals (such as accountants, lawyers and physicians), managers, administrators, some salespersons and computer programmers may be exempt from overtime requirements.  To be exempt from overtime rules, specific requirements must be satisfied.  Whether these requirements are satisfied is often at the heart of a dispute.  When an employer misclassifies an employee as exempt from overtime requirements, the employee may be able to recover the unpaid overtime premiums, various penalties under both state and federal law and the employee’s attorney’s fees.

Wage and overtime disputes often concern other related issues, such as:

• Meal and rest breaks for employees – As general rules, an uninterrupted 30 minute meal period is required for non-exempt employees who work at least five hours in a day.  A ten minute rest period must be allowed for non-exempt employees who work at least four hours per day.  An employee may be entitled to one hour of pay at the employee’s regular pay rate for each meal or rest period missed.

• Hours worked – "Hours worked" is defined as time an employee is subject to the employer’s control.  Disputes often concern whether an employee is entitled to wages for hours the employee claims were worked.  These types of disputes often involve travel time, sleep time, controlled standby time, time spent waiting, time changing uniforms, training sessions, and time working less than a normal shift. 

• Minimum wage – The California minimum wage is currently $8.00 per hour.  California requires employers to compensate non-exempt employees the minimum wage for each hour worked.  This requirement must be satisfied even if the employee is paid on a commission basis, salary basis or piecemeal.  California law entitles the employee to recover double damages for a violation of the minimum wage rules. 

• Deductions from the employee's pay – Deductions are only allowed for items that directly benefit the employee.  This includes insurance premiums, retirement plans, or other similar deductions. Charges that may not be deducted include the employer's losses suffered as a result of the employee's negligence or employee’s tardiness.

• Gratuities – A tip is the sole property of the employee for whom it is left.  Employers are not permitted to share in a tip, or to use the tip to credit wage payments, or to pay the employer’s credit card charges.  Tips paid by credit card must be paid to the employees by the next payday. The California Labor Commissioner opined that a tip pooling policy requiring an employee to contribute up to 15% of his or her tips with participants in the "chain of service" is lawful.  A person with authority to hire and fire may not be included in the "chain of service."

• Vacation – The law does not require an employer to offer vacation. However, if the employer offers vacation in a contract or policy, employees have the right to vacation pay on termination.  Thus, "use it or lose it" vacation policies are unlawful.

• Payment of wages on termination – At the end of an employee’s employment, all earned and unpaid wages are due.  Timing of the final payment depends on whether the employee quits or is fired, and the amount of notice before the employee’s final day.  An employer that willfully fails to pay final wages in a timely manner may be subject to a penalty equal to the employee’s daily pay rate up to 30 days.

The information you obtain on this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.