What Employers Need to Know About California Overtime Law
Overview of California Overtime Law
As an employer or business owner it’s important to understand the basics of California overtime laws. As of this writing the basic definition of overtime in California is any work over 8 hours in one day. If you look at it by week it would be any hours over 40 worked in a week. The pay rate would increase for any hours worked over the 8 or 40. This is typically 1.5 times the rate of their standard pay or the amount they work during their regular hours.
You are not necessarily completely restricted to the 8 hour, 40 hour work week by law. There are some cases in which you can agree with your employees for them to work 10 hours within 4 days of a single week, making it 40 hours total in one whole week. Even in this case you need to consider the overtime law, just a little differently. The criteria for overtime pay in that particular situation is for any hour worked beyond the 10-hour daily limit. This type of agreement cannot be done in a person to person basis and you should consult experts and acquire permit in order to operate like this.
Double Time Violations
Double-time violations are a little different but you still need to know about it as it is also covered in California unpaid overtime laws. Double-time violations happen when you failed to compensate your employees for their work over 12 hours in a day. Double-time rate is different than overtime rate which is only 1.5 times the regular salary. Double-time rate is computed at your employees regular rate times 2. (pretty clear why it’s called “Double time”). So remember even if you are ok with paying your employees 1.5 their regular rate for OT, once they go over 12 hours you will need to bump it up to double their normal rate.
Remember YOU are responsible for tracking the hours worked by your employees. The California unpaid overtime laws put the burden of tracking hours worked to the employers rather than to their employees. When an employee makes a claim you didn’t pay their OT hours, what you need to do is prove to the court that the claim is not true, and that they didn’t work for those hours that they are trying to claim. Make it a company policy that no employee works overtime without your (or the appropriate managers) approval and the time is recorded and tracked!
In general, almost all employees in California are covered by the overtime laws, however there are some positions that have exceptions. Check this link to see what the exceptions are and if any of your employees fall in these categories. It can be a little confusing but just know that if you don’t have any employees who fit the criteria, they are not exempt and you will have to follow all California overtime laws. If you do employ people in some of the positions mentioned you can contact us to help you figure out your exemption options.
What you should do
It’s really important for you as a business owner to understand California unpaid overtime laws. By understanding them you can plan and create company policies according to the laws and make sure they are being followed. An employee can make a claim of unpaid overtime that goes back as far as three years from the time they actually file the complaint against your company! That’s why it is so important to keep good records and have specific policies that are followed. If you do eventually face a lawsuit or wage claim, then you will be much better prepared in order to save your company from a ruined reputation and from costly lawsuit fees.
If you are a California business owner who has a overtime wage claim made against you or just have an employee issue you do not know how to deal with, contact our professional labor attorneys today. It will cost money in attorney fees but it may well save you a ton of money and possibly your business against an employee related claim. We specialize in Employer defense and only protect business owners!
We are professional labor attorneys who specialize in defending California business owners. Contact Us Today!