Do Salaried Employees Get Overtime?

Does an Employee Making a Salary Get Overtime?

This would be dependent on a few things. An employee making a salary has to receive payment for working overtime, unless they are exempt. This exemption would be stated within federal and state law. An employee would also potentially be exempt from getting overtime if it is stated within certain sections of California’s Labor Code or an Industrial Welfare Commission (IWC) wage order. If you’re a salary employee considering hiring a lawyer for a overtime time rule lawsuit, please contact our employment attorney.

What Happens If an Employer Does Not Pay Overtime to a Salary Worker?

If an employer refuses to pay owed overtime, then an employee may file a wage claim with the Division of Labor Standards Enforcement (DLSE) or the Labor Commissioner’s Office. A Deputy Labor Commissioner will then make a decision whether to:

• Reject the claim
• Refer the issue to a conference, where there may be a resolution; the parties will be mailed the time, date, and place of the conference
• Refer the issue to a hearing, where the parties may testify under oath; after, the parties will be served an ODA (Order, Decision, or Award). ODAs can be appealed, and the DSLE can represent an employee if they cannot afford a lawyer. If an employer still does not pay back wages, a court will rule against the employer

Employees also have the traditional option of suing their employer in court for unpaid overtime.

It is unlawful for an employer to retaliate against an employee for filing a wage claim. If this happens, an employee can file a complaint with the Labor Commissioner’s Office or file a lawsuit against the employer. Former workers who still have not been paid for overtime are entitled to a waiting time penalty.

In fact, unpaid overtime claims are the most typical claims in wage and hour law in California. In some cases, employers fail to pay overtime because they are merely unaware of the law. Other times, employers purposefully don’t pay overtime. This is called wage theft. In either case, employees are owed overtime and may not waive it.

What Is the Regular Rate of Pay for Salaried Employees?

To calculate the normal rate of pay for nonexempt salaried employees, one should divide the weekly salary by the amount of non-overtime hours they do. This means that if an employee works forty hours a week for which they receive $600 per week, then their normal rate of pay is $15 an hour. This is calculated by dividing $600 by forty hours.

But how does one calculate a single week’s salary? To get this number, one should multiple the monthly salary by 12 months and then divide the answer by fifty-two weeks.

California labor laws have strict regulations regarding overtime, tracking hours, and rest and meal breaks. Some jobs are exempt from these laws. An exempt employee is loosely defined as someone who is not regulated by one or more of the wage and hour laws. Determining whether you are an exempt or non-exempt employee comes down to the following:

• Minimum Salary – the employee must be paid at least twice the state minimum wage based on a 40-hour workweek.
• White-Collar Duties – 51% or more of the employee’s duties must be executive, professional, or administrative tasks.
• Independent Judgement – The employee’s duties must allow them independent judgment and discretion.

All the above three requirements must be met for an employee to be classified as exempt from minimum wage, rest break, and overtime requirements. However, there are a few exceptions to the above requirements. Certain jobs require a completely different test, and some employees are only exempt from certain labor requirements, and not others.

The most common exemptions are:

• Physicians and surgeons
• IT professionals
• Commissioned employees
• Private school teachers
• Truck drivers
• Union employees
• Outside salespeople

These types of jobs will have their own tests or be partially exempt. It is worth noting that an employee may only be classified as exempt if they “plainly and unmistakably” satisfy the requirements for exempt status.

How Soon Can Salary Employees Get Their Overtime Pay?

Employees must receive their overtime pay by the second regular payday that follows the overtime work. The extra time provides employers with the chance to get enough money to pay the overtime.

What Is California’s Overtime Pay for Salary Employees?

In California, the overtime rate of compensation is generally calculated as “time and a half.” This means that overtime pay is 1.5 times the employee’s normal rate of pay. This rule applies in the following scenarios:

• Greater than eight hours but less than twelve hours in a day
• Over forty hours in a week
• The first eight hours on the 7^th day in a row

Example: Carrie works at an office where she is working on a big project. One day, she works ten hours to finish it. She is paid overtime for the ninth and tenth hours that she works. Her overtime is paid at 1.5 times the regular rate of pay.

Employers must pay double-time wages, or twice an employee’s regular rate of pay, when an employee works either of the following scenarios:

• More than 12 hours in single day
• More than 8 hours on the seventh day in a row

Example A: Louise works for a toy manufacturer where she works eight-hour days and 40 hours a week. One day, she works 13 hours straight on a project. For this, she receives double-pay since she worked over twelve hours in a single day.

Example B: David works for a restaurant where he works eight-hour shifts and 40 hours a week. Due to a shortage of staff, he works for seven days straight. On the seventh day of work, he works a ten-hour shift. For the ninth and tenth hours, he receives double-pay.

It should be noted that hours worked does not only include the time spent working. It also includes the following:

• Meal breaks, if the employee was granted permission to work during the break
• Rest breaks
• “On call” periods
• Job preparation time
• Commuting, if it involves employer-provided transport or commute to a far-away job site