Frequently Asked Questions
Am I Entitled to Overtime Pay?
Who is entitled to overtime pay?
What is a "covered employer"?
How do I calculate my hours worked?
What types of positions are "exempt" from the overtime laws?
What is the "executive" exemption?
What is the "administrative" exemption?
What is the "professional" exemption?
What is the "outside sales" exemption?
What if I am paid a salary?
Are "independent contractors" entitled to overtime?
What are some common mistakes employers make?
How Do I Get the Money I am Owed?How do I make a claim for unpaid overtime?
How far back can I collect?
How much can I collect?
What if I haven’t kept records of my time?
Do I have to appear in court?
Tell me about your law firm.
What type fee arrangements do you offer?
What if I signed an arbitration agreement?
Won’t my employer retaliate against me for bringing a claim?
What do I do now?
Who is entitled to overtime pay?
In California, employees of covered employers are entitled to overtime pay if they work more than 40 hours of work in a workweek or 8 hours in a work day and their position is not otherwise exempt from the overtime laws. Overtime pay must be equal to at least one and one-half times the employee’s regular rate of pay.
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The following types of employers are covered by the overtime laws:
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- Federal, state or local government agencies
- Hospitals or institutions engaged in the care of the sick, aged, or the mentally ill
- Pre-school, elementary or secondary schools, or institutions of higher learning
- Companies and organizations (for-profit and non-profit) with an annual dollar volume of sales or receipts in the amount of $500,000 or more
How do I calculate hours worked?
An employee receives credit for all time that the employee is required to be on the employer’s premises, on duty, or at a prescribed work place. Work that is not requested by the employer but which the employer allows the employee to perform is compensable. For example, an employee may voluntarily continue to work at the end of the shift to finish an assigned task or to correct errors. The employer must pay for that time.
Here are some common issues that arise in calculating hours worked:
Waiting Time: If the employer requires the employee to wait for an assignment, that time is compensable.
On-Call Time: An employee who is required to remain on call on the employer's premises is working while on call. An employee who is required to remain on call at home is not working on call.
Rest and Meal Periods: Rest periods of short duration, usually 20 minutes or less, must be counted as hours worked. Bona fide meal periods (typically 30 minutes or more) generally need not be compensated as work time. However, the employee must be completely relieved from duty for the purpose of eating regular meals.
Sleeping Time: An employee who is required to be on duty for less than 24 hours is working even though he/she is permitted to sleep or engage in other personal activities when not busy. An employee required to be on duty for 24 hours or more may agree with the employer to exclude from hours worked bona fide regularly scheduled sleeping periods of not more than 8 hours, provided adequate sleeping facilities are furnished by the employer and the employee can usually enjoy an uninterrupted night's sleep. No reduction is permitted unless at least 5 hours of sleep is taken.
Lectures, Meetings and Training Programs: Attendance at lectures, meetings, training programs and similar activities are not working time, but only if they are outside normal hours, voluntary, not job related, and no other work is concurrently performed.
Travel to and from Work: Time spent traveling to work before the regular workday and home at the end of the workday is not work time.
Travel During Work: Time spent by an employee in travel as part of his/her principal activity, such as travel from job site to job site during the workday, is work time.
Travel Away from Home: Travel that keeps an employee away from home overnight is travel away from home. Travel away from home is work time when it cuts across the employee's workday.
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What types of positions are exempt from the overtime laws?
The following positions are usually classified as "exempt." However, exemptions are narrowly construed against the employer asserting them, and the ultimate burden of supporting the actual application of an exemption rests with the employer.
Commissioned sales employees of retail or service establishments if more than half of the employee's earnings come from commissions and the employee averages at least one and one-half times the minimum wage for each hour worked.
Computer professionals who are paid at least $49.77 per hour for all hours worked. Prior to 2007, the amount was less. Effective January 1, 2008, the amount will change to $36.00 per hour.
Employees of motor carriers if the employee's duties affect the safety of operation of the vehicles in transportation of passengers or property in interstate or foreign commerce.
Employees of certain seasonal and recreational establishments
Farmworkers employed on small farms.
Salesmen and mechanics employed by automobile dealerships
Executive, administrative, professional or outside sales employees who are paid on a salary basis.
Other exemptions: airline employees, baby-sitters on a casual basis, boat salespeople, buyers of agricultural products, companions for the elderly, domestic live-in employees, farm tool salespeople, federal criminal investigators, firefighters working in small (less than 5 firefighters) public fire departments, fishermen, forestry employees of small (less than 9 employees) firms, fruit & vegetable transportation employees, livestock auction workers, local delivery drivers and driver’s helpers, lumber operations employees of small (less than 9 employees) firms, motion picture theater employees, newspaper delivery employees, newspaper employees of limited circulation newspapers, police officers working in small (less than 5 officers) public police departments, radio station employees in small markets, railroad employees, seamen, sugar processing employees, switchboard operators, taxicab drivers, television station employees in small markets, truck and trailer salespeople.
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What is the "executive" exemption?
The executive exemption applies to white-collar employees who (1) have management as their primary duty, (2) direct the work of two or more full-time employees, (3) have the authority to hire and fire or make recommendations regarding decisions affecting the employment status of others, (4) regularly exercise a high degree of independent judgment in their work, (5) are paid a salary, and (6) do not devote more than 50% of their time to non-management functions.
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What is the "administrative" exemption?
The administrative exemption applies to white-collar employees who (1) perform office or non-manual work that is directly related to the management policies or general business operations of their employer or their employer’s customers, (2) regularly exercise discretion and judgment in their work, (3) either assist a proprietor or executive, perform specialized or technical work, or execute special assignments, (4) are paid a salary, and (5) do not devote more than 50% of their time to work other than that described above.
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What is the "professional" exemption?
The professional exemption applies to white-collar employees who (1) perform work requiring advanced knowledge and education, (2) work in an artistic field which is original and creative, work as a teacher, or work as a computer system analyst, programmer, software engineer, or similarly skilled worker in the computer software field, (3) regularly exercise discretion and judgment, (4) perform work which is intellectual and varied in character, (5) are paid a salary, and (6) do not devote more than 50% of their time to work other than that described above.
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What is the "outside sales" exemption?
Under California law, if an outside sales employee spends more than 50% of his or her time on duties that do not involve selling to customers (for example, making deliveries, setting up displays, moving stock, cleaning up, etc.), that employee must be paid time-and-a-half for every hour worked over 40 hours per week or 8 hours per day.
Salaried employees are entitled to overtime pay unless their position falls within one of the exemptions listed above. An employer cannot evade the overtime laws by calling an employee "salaried." In order to calculate a salaried employee’s regular hourly rate, divide the annual salary by the number of work hours in a year (usually 2,080).
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Are "independent contractors" entitled to overtime?
Some employers attempt to evade the overtime laws by calling certain workers "independent contractors" as opposed to employees. However, the employer’s choice of terminology is irrelevant. An "independent contractor" may be entitled to overtime if one or more of the following factors are present:
Exclusivity: the worker works exclusively for the employer
Importance: the worker’s services are an important part of the employer’s business
Control: the employer controls the worker’s work hours and place and manner of work
Equipment: the employer pays for the worker’s equipment, tools, and facilities necessary to complete the work
What are some common mistakes employers make?
Some of the most common errors that employers make regarding the overtime law are:
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- Misclassifying office employees as falling within the administrative exemption. Most office employees are non-exempt.
- Requiring employees to work "off-the-clock." All time spent working on behalf of the employer is compensable.
- Attempting to avoid paying overtime by making the employee "salaried." The employee’s job duties, not the form of pay, determines whether he/she is entitled to overtime pay.
- Asking employees to "waive" overtime pay. This is illegal.
- Docking an exempt employee’s pay for absences due to illness, when the employer does not have a formal sick leave policy. This converts an exempt employee into a non-exempt employee (i.e., entitled to overtime).
- Docking an exempt employee’s pay for absences of less than one day or for variations in the quality or quantity of the employee’s work. This converts an exempt employee into a non-exempt employee.
- Allowing exempt employees to perform non-exempt work more than 50% of the time. This converts an exempt employee into a non-exempt employee.
- Failing to maintain accurate records of actual time worked. This may prevent the employer from proving the existence of an exemption.
How do I make a claim for unpaid overtime?
Employees have three options for recovering unpaid overtime: (1) file a private claim; (2) file a claim with the U.S. Department of Labor; or (3) file a claim with the state labor commissioner. We have found that government agencies, although well-intentioned, are often understaffed, and they lack a financial incentive to assist you in pursuing your claim. In addition, there are certain procedural advantages to filing a claim in court as opposed to pursuing a claim before a government agency. We believe that pursuing a private claim is the best choice.
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In California, you may be able to recover up to four years of overtime pay, plus interest and penalties.
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For each hour of overtime worked, you are entitled to one and one-half times your regular rate of pay. In addition, you are entitled to interest on the unpaid amount plus your attorney’s fees. You also may be able to recover penalties.
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What if I haven’t kept records of my time?
Under California law, the burden of keeping accurate time records is on the employer, not the employee. If no accurate time records exist, you are entitled to submit a reasonable estimate of your hours worked.
Nearly all cases are resolved without the employee having to appear in court. In some cases, you may be asked to give a deposition (a statement under oath before a court reporter) in an attorney’s office. However, one of our experienced attorneys will accompany you to the deposition and meet with you beforehand to let you know what to expect.
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The attorneys at Dostart Clapp Gordon & Coveney, LLP have special expertise in overtime law and can assist you in obtaining a prompt, cost-effective resolution of your claim. We have recovered hundreds of millions of dollars in unpaid overtime on behalf of our clients. (Of course, results depend on the facts of each individual case.) The firm maintains an “AV” rating, the highest rating offered by Martindale-Hubbell, the country’s leading attorney rating service. The rating of “AV” signifies “very high to preeminent legal ability and very high ethical standards as established by confidential opinions from members of the Bar.”Our firm represents employees on a contingency fee basis. This means that we advance all attorney’s fees and litigation costs necessary to prosecute your claim, and we are not paid unless we recover money for you, either through a judgment or settlement.We find that the best way of pursuing a private claim is through a class action. A class action is a procedural device that allows one or more individual plaintiffs to sue on behalf of a class of employees who have been similarly injured. In overtime cases, a class action is often preferable to bringing an individual claim, since the costs of the lawsuit are spread out over more parties. In addition, in class actions, the court is responsible for setting the amount of the attorney’s fees, and this amount is usually paid by the employer. Our firm is very experienced in bringing overtime class action claims.
What if I signed an arbitration agreement?
If you are a client manager, relationship manager or personal banker and signed an arbitration agreement, that agreement may be unenforceable. Our firm will quickly evaluate whether you are subject to an enforceable arbitration agreement and, if so, what your rights are.
Won’t my employer retaliate against me for bringing a claim?
Under both California and federal law, it is illegal for an employer to retaliate against, discriminate against, or harass an employee who makes a claim for unpaid wages. Violating these laws can subject an employer to possible criminal penalties, as well as punitive damages.
Contact us, either by filling out our forms page, or by calling Kirk Donnelly during regular business hours at (858) 623-4200. Consultations are free.