Overtime in California

There are two requirements in the calculation and payment of overtime – daily overtime and weekly overtime.

Daily overtime - Over eight hours worked in a day must be paid at 1 ½ times regular rate of pay.

Weekly Overtime – All hours worked over a 40 hour week in a 7-day workweek shall be paid at 1 ½ times regular rate of pay. Example: An employee works a sixth day in the workweek, he shall be paid at 1 ½ regular rate of pay for all hours worked over 40.

When Must I Pay Double Time

You must pay double the employee’s regular rate of pay for:

• All hours worked beyond 12 in a single workday; and

• The hours worked beyond eight on the seventh consecutive day worked in a single workweek.

If an employee works a six-day workweek, but has not worked more than 40 hours in that workweek, no overtime  is owed unless the employee works more than eight hours on the sixth day. Regarding minors and daily overtime, it is a misdemeanor  to require a minor  to work more than eight hours in any one workday, regardless of whether you pay overtime for the hours over eight. Vacation hours or sick leave pay does not count toward overtime. It must be “sweat time” or time spent actually working.

Example of calculating daily overtime, weekly overtime, and double time (workweek Monday through midnight Sunday):

 

Schedule 

All Hours Worked 

Regular Hours 

Daily OT 

Weekly OT (Over 40) 

Double-Time 

Payable

Monday

8.32

8

0.32

0

 

 

Tuesday

4.00

4

0

0

 

 

Wed.

8.67

8

0.67

0

 

 

Thursday

8.93

8

0.93

0

 

 

Friday

9.50

8

1.5

0

 

 

Saturday

8.00

4

0

4

 

 

Sunday

9.00

 

0

8

1

 

 

 

 

 

 

 

40 hrs. Straight Time

 

 

 

 

 

 

15.42 hrs. Overtime

 

 

 

 

 

 

1 hr. Double-Time

Meal Breaks and Rest Periods

Over the past several years, class-action lawsuits challenging employer meal and rest period practices exploded in California courts. Although some employers view meal- and rest-period rules as technical and insignificant, the truth is that these claims can be financially devastating. Last year the U.S. District Court for the Northern District of California approved an $87 million settlement in a meal- and rest-period class action lawsuit filed against a major courier and logistics provider. With lawyers soliciting new plaintiffs that could represent a class of workers every day, California employers need to understand the rules and take affirmative steps to protect their companies against liability for meal and rest period violations.

Meal Period Rules

All nonexempt (hourly) employees must receive a 30-minute unpaid meal period for shifts exceeding five hours. The meal period must be provided within the first four hours and 59 minutes of the workday. If the employee works a shift that exceeds 10 hours, the employer must provide a second unpaid meal period of at least 30 minutes. This second meal period must be provided within the second four hours and 59 minutes of work.

Meal-Period Waivers: An employee who works a shift of six hours or less may voluntarily agree to waive the right to a meal period in writing. Similarly, if an employee works a shift of 12 hours or less, the employee may voluntarily agree to waive the second meal period (if the first meal period has not been waived). A valid meal-period waiver must be in writing and explicitly state that the employee can revoke the waiver at any time. Please consult with Human Resources regarding meal period rules and waivers.

Rest Period Rules

California law mandates that nonexempt (hourly) employees be granted a 10-minute break for every four hours worked. So in the typical eight-hour workday, the employee would be entitled to receive at least two 10-minute breaks. These breaks must be paid. The employer may require employees to remain on the employer’s premises during their rest breaks.

Enforcement Obligations

The courts have ruled that employers “have an affirmative obligation to ensure that workers are actually relieved of all duty” during meal periods. In other words, the employer needs to make sure that they take a meal break. This standard imposes a significant burden on employers not only to adopt valid meal-period policies, but also to police the workplace and discipline employees who fail to take meal periods as required by law.

Enforcement mechanisms should include maintaining accurate time records, including clocking “in” and “out” for meal breaks, and keeping notations for rest periods. Employers should also train their supervisors on meal- and rest-period enforcement guidelines, regularly audit time records for meal- and rest-period compliance and be prepared to discipline any employee who fails to comply with the employer’s written meal- and rest-break policy.

Penalties

If the employer fails to provide each employee with a meal break as outlined above or if the employee simply fails to take a meal break, the employer is required to pay the employee one (1) hour of pay at the employee’s regular rate of compensation for each workday that the meal period is missed. These penalties can add up fast so you need to make sure your employees are tracking their time worked, their meal periods, and whether they missed the meal period. You should also be tracking when you paid them the one-hour penalty, which should be right away after finding out about any missed meal period.

Additional Penalties

If an employer discharges or lays off an employee, final wages are due and payable immediately. If an employer fails to pay wages due an employee at the time of termination or in accordance with Labor Code Section 203, the employer can be assessed waiting time penalties. The penalty is measured at the employee’s daily rate of pay and is calculated by multiplying the daily wage by the number of days that the employee was not paid, up to a maximum of 30 days. This does not mean that the wages continue for a 30-day period, but that the employee may be entitled to up to 30 actual days’ worth of wages. The 30-day period is calendar days, and includes weekends and holidays and any other days that the employee would not normally work.

Example: An employee does not receive his final paycheck or his meal break penalty for 10 days and he earned $15.00 per hour, the waiting time penalty would be $1200.00 (one day’s pay for each day late).

Do not let termination checks lie around – make sure they get to the terminated individual or are mailed on the day of termination. If an employee quits without notice, you have 72 hours to get them paid.

Consult with Human Resources for more information on the above at 619-588-2411.


 

 

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