The Fair Labor Standards Act (“FLSA”) sets the guidelines for overtime pay requirements. Generally, when an employer allows or requires an employee to work overtime, they are required to pay them an increased rate for the overtime work. Employees covered by the FLSA must receive overtime pay for hours worked in excess of 40 hours; however, the FLSA does not require overtime pay for hours worked on weekends or holidays.

The FLSA does not specify a set limit regarding the number of hours to work in any workweek. However, different workweeks can be formed for employees or groups of employees. Additionally, the overtime requirement cannot be waived by agreement between employer and employees; and, an employer cannot block an employee from working overtime, and cannot require an advance authorization for any work done overtime.

It is imperative to note that the employer cannot refuse to pay for any work done overtime if it is covered by the FLSA, as employees have a right to compensation that they worked for. Overtime pay must be calculated based on the average hourly rate derived from the earnings worked for during the workweek. These earnings may be based on a piece-rate, salary, or commission.

The federal minimum wage that is set by the FLSA is currently $7.25 per hour. However, each state has set their own minimum wage laws, and employees are entitled to receive the higher of the two rates depending on federal or state.

Some local cities and counties have “living wage” laws which set a higher minimum wage and apply to the companies that do business in the local area or government. In such cases, the employer must pay the highest minimum wage, whether federal, state, or local. However, just because minimum wage determines the hourly rate, employers do not need to pay employees by the hour. As long as the total amount paid divided by the total number of hours worked is equal to at least the minimum wage, it is considered to be legally compatible.

However, not all employers are required to pay the minimum wage, as there are two requirements set forth in order for the employer to pay its employees minimum wage. Under the FLSA, your business must receive $500,000 or more in annual sales; and, your employees must work in “interstate commerce,” which generally means doing business between the states.

The following are employees that are exempt from receiving federal minimum wage:

  • Independent contractors;
  • Outside salesperson;
  • Workers on small farms;
  • Switchboard operators who are employed by phone companies with no more than 750 stations;
  • Seasonal amusement or recreational business employees;
  • Employees of local newspapers that have a circulation of less than 4,000;
  • Newspaper deliveries; and
  • Students and learners as defined by law.

For employees who earn tips, the minimum wage guidelines can vary considerably. The current federal wage law allows for employers to pay a different hourly rate to employees who are regularly receiving tips. However, these tips must amount to enough to meet minimum wage requirements.

An example of this would be how some states allow wait staff to be paid $2.75 per hour because it is expected that they will receive enough tips to at least equal the minimum wage. During hours in which the employee does not make enough in tips to equal the minimum wage, their employer must compensate for the difference.

What Are Overtime Pay Laws In California?

According to California law, non-exempt employees who are working over 8 hours in one day, or over 40 hours per workweek, must receive overtime pay for the additional hours. A workweek is considered to be six days; as such, if they are working additional hours on the seventh day over the 40 hour workweek, the employee must receive overtime pay.

These overtime laws also apply to minors who are aged 16-17, as well as all adults who are over the age of 18. California is a no waiver state, which means that employees cannot elect or agree to work the additional hours at their regular rate or less. Their employer must pay the overtime pay.

What Is The Difference Between Regular Pay And Overtime Pay In California?

Regular pay is the compensation that an employee and their employer agreed upon when the employment relationship began, generally a set amount per hour. California overtime laws use the employee’s regular rate of pay when calculating their overtime pay.

If the employee works over 8 hours in one day, they must receive one and one-half times their regular rate for the hours that they work beyond the eight hours in that day. That overtime rate continues up to and includes 12 hours in any workday, as well as the first eight hours worked on the seventh consecutive day of work in a workweek.

The employee must receive double their regular rate of pay for all hours worked which exceed 12 hours in any workday; and, for all hours that exceed eight hours on the seventh consecutive day of work in a workweek.

The simplest rate to calculate is hourly in that if the employee is paid hourly, that hourly pay will be the regular rate. If the employee is salaried, the regular rate is determined by:

  • Multiplying the monthly remuneration by 12 months in order to get the annual salary;
  • Divide the annual salary by 52 weeks to get the weekly salary; and
  • Divide the weekly salary by the number of legal maximum regular hours, which are 40, to get the regular hourly rate.

Overtime for employees who receive two different rates of pay, by the same employer in a workweek, is calculated by using a weighted average before applying a similar formula. Commission-based employees and employees who are paid by the piece that they produce are also entitled to receive overtime wages.

Additionally, overtime pay must include all compensation that the employee regularly receives as pay. Their regular rate must meet the requirements for both federal and California minimum wage laws. To reiterate, this can include:

  • Regular wages, such as an hourly wage;
  • Non-discretionary bonuses that are measured or awarded based on hours worked;
  • Commission payments; and/or
  • Piecework payments.

What Else Should I Know About Overtime Pay Laws In California?

California law allows for several exemptions to the overtime requirements, for certain types of employers as well as certain types of workers. Employees who work overtime without the authorization of their employer must still be paid overtime pay, as long as the employer should have known about the hours. However, if the employee conceals the overtime work in an attempt to deceive the employer and obtain additional pay, the employee will not be entitled to the pay.

Some salaried employees are eligible for overtime, and non-exempt salary workers are eligible. The government provides criteria that must be met in order to grant exempt status; as such, many salaried workers are not eligible.

An employer can require an employee to work overtime as long as they comply with the overtime pay laws. If an employee refuses to work those overtime hours, the employer may be allowed to terminate the employee.

Do I Need A Lawyer For Help With Overtime Pay Laws In California?

If you are entitled to overtime pay and did not receive it, or if your employer wrongfully categorized you as exempt, a California employment lawyer can help determine whether you actually qualify.

An experienced contract attorney will also take legal action so that you may receive your pay. Your attorney will help you understand your legal rights and options according to your state’s specific laws, and will also be able to represent you in court, as needed.