October 10, 2018

Overtime:  California Labor Code section § 510(a) has long provided that employees entitled to overtime (called “non-exempt employees”) must be paid overtime in the following situations:

• For work performed in excess of 8 hours in any one work day;
• For work performed in excess of 40 hours in any one work week; and
• For work performed on the 7th day, when the employee works all 7 days of a work week.

Exempt employees (those exempt from the overtime rules) are those employed in executive, administrative, or professional jobs.  For example, employees who manage more than two other employees and have the ability to hire and fire are exempt employees, and are not entitled to overtime.  So are professionals such as engineers, architects, doctors, lawyers, and dentists.

Employees who are non-exempt, and are therefore entitled to overtime, must be paid at least 1½ times their regular rate of pay for all work performed between 8 and 12 hours in any given work day, and also for the first 8 hours worked on the 7th consecutive day of work in a work week.  For any work in excess of 12 hours in one day, and any work over 8 hours on the 7th consecutive day of work in a work week, they must be paid at least twice their regular rate of pay.

Recent Development:  On March 5, 2018, the California Supreme Court ruled that when calculating an employee’s overtime rate for a certain week, the employer must start with a base pay that incorporates any flat-sum bonuses the employee received.  The bonus must be divided by the number of non-overtime hours worked, then that “hourly” bonus rate is added to the employee’s regular hourly rate, and the result multiplied by 1½ (or by 2 for double pay) to calculate the overtime rate.  [Alvarado v. Dart Container Corp. of California (2018) 4 Cal.5th 542.]

For example, if you worked a 40-hour week before overtime, and were paid $20 per hour for those 40 hours plus a $100 bonus, then the base pay for calculating your overtime is $22.50 ($20 plus ($100 divided by 40)).  Some employers were using only the regular hourly rate (here, $20) or else were dividing the bonus by the total number of hours worked, not just the non-overtime hours.  Both of those methods are wrong, and if used will deprive the employee of overtime pay.  Calculated correctly, your time-and-a-half overtime rate in this example would therefore be $33.75/hour, not the $30 per hour that would be calculated without using the bonus.

An employee who prevails on an overtime claim can be awarded back pay, legal fees, and costs.  [Cal. Labor Code § 1194.]

Age Discrimination:  California law has long forbidden employers from discharging, dismissing, reducing pay, suspending, demoting, or refusing to hire or employ, any individual who is over the age of 40 on the grounds that a younger person will take the job for a lower salary.

Recent Development:  Section 1798.83.5, added to the California Civil Code in 2017, bans online entertainment-job posts or recruiting websites from displaying a subscriber’s birth date or age.  This law is part of a series that arose from concern with companies which sell personal information of consumers with whom the company does business.  This particular provision focuses on personal information that can be used by potential employers for age discrimination.

Genetic Testing:  It is established law in California that employers cannot subject employees, applicants or other persons to testing for genetic characteristics.  The term “genetic characteristics” means any of the following:

A.  “Any scientifically or medically identifiable gene or chromosome, or combination or alteration thereof, that is known to be a cause of a disease or disorder . . . or that is determined to be associated with a statistically increased risk of development of a disease or disorder, and that is presently not associated with any symptoms of any disease or disorder.

B.  Inherited characteristics . . . that are known to be the cause of a disease or disorder . . . or that are determined to be associated with a statistically increased risk of development of a disease or disorder, and that are presently not associated with any symptoms of any disease or disorder.

[Cal. Gov. Code §§ 12940(o) and 12926(i)(2).]

Recent Development:  California’s genetic information privacy law was amended this year to prohibit employers from retaliating against those who refuse to submit to genetic tests or disclose genetic information.  This change in the law became effective on January 1, 2018.

Need more information?
ESKRIDGE LAW may be contacted by phone (310/303-3951), by fax (310/303-3952) or by email (geskridge@eskridgelaw.net).  Please visit our website at eskridge.hv-dev.com.

This article is based on the law as of the date posted at the top of the article.  This article does not constitute the provision of legal advice, and does not by itself create an attorney-client relationship with Eskridge Law.