Attorneys Handing Salary Misclassification And Overtime Lawsuits For California Workers
Only salaried employees qualifying under the “white collar” overtime exemptions are exempt from receiving the overtime premium. Executive (managers), administrative, professional, sales and computer professional employees are exempt from overtime requirements in California, provided they meet certain tests regarding job duties and responsibilities and are compensated on a salary or guaranteed commission basis at not less than stated amounts.
Employers often avoid paying overtime by misclassifying employees in salaried positions as “exempt” from overtime pay. These are narrow exceptions to the general rule that all employees are entitled to premium pay for overtime hours, generally either time-and-a-half for hours worked — between 8 and 12 per day or 40 per week — or double time for hours exceeding 12 per day or on the seventh straight day during a workweek.
IT and computer technology workers, loan consultants, inside sales representatives, managers and assistant managers, pharmaceutical representatives and others work long overtime hours but are often misclassified as salaried employees and not provided premium overtime pay. At Cohelan Khoury & Singer, our skilled employment law attorneys have helped these and other workers reclassify their states and seek restitution of back pay under California law.
Who Is Exempt From Overtime Pay In California?
To avoid paying overtime, employers must establish that workers fall under one of the following exemptions:
Executive Exemption
The executive exemption typically classifies managers and assistant managers as exempt from overtime. To qualify, employees must primarily engage in management duties, oversee at least two full-time employees, have hiring and firing authority or influence, regularly exercise significant independent judgment and earn a guaranteed salary of at least twice the state minimum wage for full-time work per week.
Administrative Exemption
This exemption applies to employees engaged in nonmanual (office) work related to management policies or the general operation of the business, either for their employer or the employer’s customers. These employees must exercise discretion and judgment regularly and work under general supervision on specialized tasks requiring specific training, experience or knowledge. Employees focused on producing the employer’s product or service do not qualify as administrative employees. They must also receive a guaranteed salary of at least twice the state minimum wage for full-time work each week.
Some of the most commonly misclassified workers under the administrative exemption are IT specialists, pharmaceutical reps and loan officers.
Professional Exemption
The professional exemption applies to employees who perform advanced, specialized work, often requiring education beyond a bachelor’s degree. This includes those with state licenses or certifications in fields like law, medicine, engineering, and teaching, as well as those working in creative artistic roles. These employees must regularly exercise discretion and judgment and earn at least twice the state minimum wage for full-time work.
Outside Sales Exemption
Employees who spend less than 50% of their time on actual outside sales and related activities are entitled to overtime. Outside sales exclude sales made by mail, telephone or the Internet unless these methods are secondary to in-person client visits. Any fixed location, such as a home or office, used for sales calls is considered an employer’s place of business and does not count as outside sales. Sales initiated by telephone typically do not qualify as outside sales.
Inside Sales Exemption
Inside salespersons who work on commission must receive at least one-and-a-half times the minimum wage for all hours worked weekly and earn over half their income from genuine sales commissions to be exempt from overtime under California law. They are also entitled to rest and meal breaks or premium compensation if breaks are not provided.
Computer Professional Exemption
This is a detailed and complex area of law which we cover in greater detail on our page for IT and computer tech workers. Suffice it to say that these professionals are too often misclassified, overworked, and underpaid. If you work in this industry, we would be happy to provide case-specific guidance and advice in a free consultation.
A Note About Overtime Pay For Managers And Assistant Managers
Salaried managers and assistant managers in California are entitled to overtime pay for hours worked beyond eight hours per day or 40 hours per week if they spend more than half their work time performing the same tasks that nonovertime exempt hourly, nonmanagerial employees work.
They are also entitled to overtime if they do not customarily supervise two or more full-time nonexempt employee positions. Functions such as selling, cashiering, stocking, inventory, setting up, tearing down, bartending, waiting tables, cleaning, delivering and similar tasks are nonmanagerial and do not count toward the minimum managing hours required for an employer to avoid paying overtime pay.
Have You Been Misclassified? Get Answers To Your Questions In A Free Consultation.
You deserve to be paid at least what the law entitles you to, but that can’t happen if you’ve been misclassified. At Cohelan Khoury & Singer, we provide free consultations to clients throughout California, so you have nothing to lose by exploring your legal options. To get started, call our San Diego office at 888-652-2201 or reach out online.