California Employee Rights Advocate : California Labor Attorney & Lawyer : Southern CA Employment Law : Los Angeles, Orange County : United Employees Law Group

With the end of the year quickly approaching some people will be working on holidays others will be taking time off from work and we will all be hopeful for a little extra cash. California labor laws are pretty clear about how employers must treat these situations and what employees should expect.

Holiday Pay

California labor law does not require employers to pay employees extra for working on holidays. However, there are quite a few companies out there that offer their employees 1.5 times their regular rate or even double time. If this is a company policy then the employer must adhere to it. The best way to make sure you know what the company policies are regarding holiday pay would be to review your employee handbook or contact your human resource department. If these policies are not in writing it would be a good idea to request a written copy.

Vacation Pay

Vacation pay, sometimes referred to as paid time off (PTO). California labor laws do not require employers to offer PTO or vacation pay but if it is offered by the employer then the employee is either entitled to use it or be paid for its monetary value. It is important to note that the employer cannot take it away. “Use it or lose it” policies are not legal in the state of California. With that being said, the employee must understand that the employer does not have to give you the time off that you request. If your request for time off is denied you could lose your job if you leave anyway. You may decide to ask for your vacation pay on your next pay check instead of actually taking the paid time off.

Bonuses

Again, bonuses not required by California labor law but still common practice by most employers. Other common practices during the holidays are gift giving either in the form of actual tangible gifts or in the form of gift cards. In either instance you will notice that the monetary value of these gifts or bonuses will be taxed on your pay check. This often confusing to read on your paystub, but more than likely you will see the value on the gift added to your wages, then taxes will be taken out of your pay, then you will see the original amount of the gift deducted. This practice is required by law nationwide, all gifts and bonuses must be counted as wages according to the IRS.

Labor law is complex if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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People call in everyday with various employment issues or concerns but what is interesting to me is that the majority of the time they have one of these 5 issues and they didn’t even know it. I have had clients tell me that they just assumed that they were being paid and treated properly because the company that they work for is so big and well known:”they must know what they are doing, right?!” The truth is that labor violations occur in any size business and that it’s the employee who needs to arm themselves with knowledge of their rights or at least contact a California labor law attorney with any questions or concerns.

1. Misclassified as an Exempt Employee (salary)
….when in fact they should be Non-Exempt (hourly). Companies are not allowed to arbitrarily classify their employees as exempt from overtime. California labor laws have set strict guidelines regarding who will be considered exempt. The most important thing to remember is that your exemption status is based on your actual job duties, not on your job title or on the job descriptions given to you by the company.

2. Working Off the Clock
Non-Exempt employees are often pressured to work while they are not clocked in. This could mean coming in early to work to prepare for the day or clocking out and remaining to finish work at the end of the day. Often times employers will not come right out and tell their employees that they must work off the clock, but the employer might pressure the employees by threatening with write-ups or termination if all of the work is not completed before the end of the day and in the same breath make it known that overtime is not allowed. Other times it’s more systematic, for example: an employee must spend 10 minutes in the morning booting up the computer system and logon to their computer before they are granted access to use the time keeping system. Or route drivers often have to load their trucks but their time clock doesn’t start until their first stop.

3. Misclassifying Employees as Independent Contractors
Often time employers will classify employees as independent contractors in order to avoid paying overtime, additional taxes and insurance. Again California Labor law has set guidelines regarding who can be classified as an Independent contractor. In order to be an independent contractor you should be responsible for the following:
• Make your own schedule
• Use your own equipment, vehicle, tools etc
• Not have to wear a uniform for the other company
• Not have a supervisor or manager directing you on a regular basis

4. Not Providing Suitable Seating for Employees
Private Attorneys General Act ("PAGA") states "nature of the work reasonably permits the use of seats." Recently large companies like Home Depot, Whole Foods, Costco and Nordstrom have all been in the courts for this violation. Typically for not providing seating to cashiers or other positions where the employee is somewhat stationary.

5. Failing to pay Reporting Pay
Reporting pay is owed when an employer has an employee come to work but the decides that person is not needed for the day and sends them home or works less than half of the shift they were scheduled to work. At this point an employer is required by California labor law to pay this employee for half of the usual or scheduled day's work. This amount should be no less than two hours or more than four hours at the employee's regular rate. The exception is that employee was unable to work due to acts of God, threats to employee or property, etc.

Labor law is complex if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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Wage Theft Prevention Act of 2011

According to Section 2810.5 of AB 469, at the time of hire all employer must now inform, in writing, employees of rate of pay and the of how wages will be calculated. In other words: hourly, daily, piece rate, salary, commission or by some other method. If applicable the employees must also be informed of their overtime rate, allowances, the regular pay date, the name of the business or any other names the business operates under as well as the physical mailing address for the business. AB 469 also requires that any changes made to this information be given to the employees in writing within 7 days of the change. Not only does the existing law require employers to pay penalties and back wages for violating minimum wages laws it now criminalizes certain wage violations by providing that any employer who willfully violates specified wage orders, willfully fails to pay wages due, if convicted is guilty of a misdemeanor. It important to note that, the statute of limitation for collecting penalties under the Division of Labor Standards Enforcement ("DLSE") has increased from one to three years.

Commission Contracts will be required by 2013

By January 1, 2013 AB1396 will amend the labor code to require employers to have written contracts with all employees who will receive wages from commissions. This contract must also define how these commissions will be calculated and when they will be paid. This does not include bonuses or short term incentives. This should alleviate the guess work and should allow the employees the ability to track and determine, in advance, what their commission pay will be. AB1396 will be particularly helpful to employees that are classified as inside sales or outside sales people.

Wage Garnishment : Medical Debts are now Exempt

Currently the law requires employers to garnish employee’s wages up to the portion of the earnings the debtor proves is necessary to support himself or his family, for things like Child support payments, back taxes, credit card debt, and other debts can all be subjected to wage garnishment. AB 1388 adds an exemption for debt that is incurred "for the common necessaries of life furnished to the judgment debtor" or his or her family, including, e.g., hospital services and other medical debts.

Even though most of these new laws will take effect January of 2012 it is recommended you speak with an experience California labor law attorney as soon as possible if you have any questions or concerns about your employment situation.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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Both houses of the California Legislature recently passed S.B. 459 and sent it on to Governor Brown for signature. S.B. 459 prohibits and punishes the "willful misclassification" of employees as independent contractors; S.B. 459 would impose stiff civil penalties for each violation and even higher penalties if a "pattern" of violations is found.

At the same time the IRS has unveiled an employer forgiveness program, called the Voluntary Classification Settlement Program. Wherein if an employer voluntarily comes forward and reports that they have been misclassifying their employees as independent contractors the IRS would require that they only pay approximately 10 percent of the back taxes. The IRS also promises no audits and no penalties on unpaid taxes.

However the IRS has no control in courts as far as labor laws are concerned so the companies that do come forward will be opening themselves up for lawsuits for overtime back pay. With the new legislation S.B. 459 and its stiff civil penalties for each violation and even higher penalties if a "pattern" of violations is found, this could be very costly to employers.

S.B. 459 creates two new unlawful practices

1. "Willful misclassification" of an individual as an independent contractor.
2. Charging a willfully misclassified worker a fee, or making any deductions from compensation for any purpose that would have violated the law governing deductions from pay — Labor Code §§221 and 224 — had the worker properly been classified as an employee.

It’s important to also note the change in the definition of "Willful misclassification". Previously the definition of "willful" in earlier versions of the legislation was "voluntary and intentional" the new bill redefined “willful” as "avoiding employee status for an individual by voluntarily and knowingly misclassifying that individual as an independent contractor.” Knowingly being the operative word. "Knowing" is interpreted by the courts as including constructive knowledge, which in turn incorporates what the employer allegedly should have known — an inexact and subjective standard applied post hoc by a finder of fact. In other words, even if the employer believed they were classifying the independent contractors according to law the employer is still expected to know otherwise.

If you are currently classified as an independent contractor you should have control over the following:

- Make your own schedule
- Use your own equipment, tools, vehicle
- Not required to wear a uniform or clothing with company logo
- Use/ purchase your own materials to complete work
- No constant supervision of tasks and performance

If any of these conditions are not met you should contact an experience California labor law attorney to review your situation. You may be entitled to overtime back pay as well as penalties for missed meal and rest breaks.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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The Administrative Exemption is one of the most disputed exemptions under California law due to its ambiguity. The question is usually whether or not the employee should be compensated for overtime or if they are properly classified as exempt from overtime. California courts have examined the Administrative Exemption under the Federal Labor Standards Act (FLSA)

Bell v. Farmers Ins. Exchange (2001) is a noteworthy case in which the courts review whether or not the employees met the requirements to be considered exempt from overtime. First the minimum requirement rate of salary must be met. Then the administrative work must be

(1) non-manual
(2) related to management policies or general business operations of the employer or the employer's customers
(3) must involve the customary and regular exercise of discretion and independent judgment.

The stipulation "directly related to management policies and general operations of the employer or the employer's customers" is often the key requirement that is scrutinized most due to its expansive nature. But more often than not California courts reject the argument often made by employers that "management policies and general operations" must be interpreted broadly and it applies to any employee who exercises minimal discretion in his work. The California Courts interpretation of the language in this stipulation is much more focused.

The interpretation has been published in the decision in Bratt v. County of Los Angeles (1990) to mean directly related to management policies or general business operations, as in running of the business and not merely the day to day carrying out of its affairs. The Bratt Court considered whether the county probation officers are exempt from overtime under administrative exemption. The court concluded that although probation officers provide recommendations to the courts, these recommendations do not involve advice on the proper way to conduct the business of the court, but merely provide information which the court uses in the course of its daily production activities.  So it was decided that the tasks the employees preformed did not meet the requirement to be exempt from overtime under the Administrative Exemption

If you are concerned that you might be improperly classified as exempt from overtime you should contact and experienced California Labor law Attorney and have them examine your job duties. You could be owed a substantial sum of money in overtime back pay.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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The nation has been anxiously awaiting the, the California Supreme Court opinion of California’s employment laws regarding non-resident employees who perform work in California. While the decision will likely force many employers to reevaluate their non exempt payment policies, specifically overtime. Presumably, a large number of lawsuits will follow, including class actions, demanding back pay of overtime.

Sullivan v. Oracle has been settled and appealed several times. The premise of the case was that several Arizona and Colorado residents were employed by Oracle as instructors; they argued that they were entitled to overtime under California law when they had preformed work in California. However, Oracle had classified the instructors as exempt employees and as such they were not paid overtime. This case required the interpretation of two labor laws principals; first whether or not the nonresidents were covered under California labor laws and second if they were classified properly as exempt employees. The federal Ninth Circuit Court of Appeal certified these issues for the California State Supreme Court to decide.

Most companies in California are aware that California law has several striking differences from the federal Fair Labor Standards Act (“FLSA”). Specifically exemptions from overtime under California labor law are examined differently than under the FLSA, specifically focusing on not what an individual’s “primary” duties are, but on the duties in which they are “primarily” engaged. Furthermore, California labor law requires that overtime be paid at time and half for hours 8-12 in a day and for double time for work performed beyond 12 hours in a day. Meal and rest breaks to non-exempt employees are also a requirement under California labor laws.

The California Supreme Court found that California’s overtime laws do apply to non-resident employees who perform work in California. The Court went a step further to conclude that the state overtime laws did not make a distinction between residents and non-residents, and clarified that it would defeat the purpose of those laws if employers could simply “import unprotected workers from other states.”

While the decision is limited to “California-based” employers; the court did not provide a definition for this term. As such, employers based outside California should not ignore Sullivan. There is every reason to believe that non-resident workers of employers based outside California will contend that they, too, should be covered by California’s wage-hour laws when working in the state. And, based on the broad language in Sullivan, there is every reason to believe the California Supreme Court might agree.

What Employee Should Do now when traveling to California to work

• Keep accurate records of your work hours and all breaks.
• Make a list of all the job duties you are expected to perform while in California.
• Keep accurate records of your travel time and all travel expenses, including mileage.

If you are not paid for all hours worked or have been classified as exempt from overtime contact an experienced California labor law attorney to examine your records. You might be owed back pay for your overtime, meal and rest breaks as well as travel time and expenses.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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Most people are not paid to drive to work they are paid once they arrive and begin their work. Mike Ritti sued Lojack for his commute time and originally lost. However, Rutti v Lojack, March of 2010, the 9th circuit court of appeal found that Rutti and all other technicians at Lojack were owed their commute time from home to their first stop.

Mike Rutti worked for Lojack as an installation technician. As such he would drive a company vehicle from his home to the client’s location each morning to in install alarm systems. Lojack had several company policies regarding the work vehicle. Rutti was not allowed to: run personal errands in the vehicle, have any passengers other than co workers, use his cell phone while driving and he was required to go directly to the job in the morning and directly home at the end of his last appointment.

Rutti Sued Lojack on behalf of himself and all other technician for his commute time and for the time he spent performing “preliminary” activities, such as, mapping, receiving, prioritizing tasks/jobs, routing before leaving his home every morning. As well as the time he spent at the end of his day when he returned home to wrap up all of the necessary documentation from that day’s work.

Originally the court found that Rutti’s commute time and pre/post work activities were not compensable under the Employee Commuting Flexibility Act (ECFA). Then new case law presented its self: Morillion v Royal Packing Company, where the California Supreme Court found that employees must be compensated during time when an employee is subject to the control of the employer. Rutti filed an appeal and will receive back pay for the time he spend working off the clock during his commute. However, the court determined that the time he spent at home before and after his commute was not compensable based on the language found in the ECFA.

The ECFA states that employers are not required to compensate employees for activities which are preliminary to or postliminary to the employees principal activities. It further designates that even if the activities are related to the employees principal activity the time is still not compensable if it is de minimis.

In determining if an activity is de minimis the court considered:

• The practical administrative difficulty of recording the additional time
• The aggregate amount of compensable time
• The regularity of the additional work

The court found that Rutti’s pre and post activities were not integral to his principal activities and so they are not compensable.

In conclusion, if you have any restrictions placed on you by your employer during your commute to and from work you should have an experience California employment attorney review your case.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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Cisco Systems has plans on the drawing board to cut 15 percent of its workforce and place for sale a factory as part of its strategy reduce expenses by $1 billion as an attempt to improve its bottom line.

The numbers to be laid off shake out like this. It appears that 11,500 jobs, will be cut in contrast to just several thousand that analysts had surmised.

Many Cisco employees may come to realize that they were wrongly classified as exempt from California overtime pay laws. If this is the case, such employees are entitled to go back and collect up to four years of overtime pay under California labor laws.

“It is not unusual for employees to realize in the most desperate of times, that they were in fact, entitled to overtime pay all along due to the misclassification error made by their employer. Many employees do not realize that it is the job duties you perform and the amount of independent discretion you have that determines whether you are entitled to overtime pay- not your job title or the amount of salary you earn,” says Walter Haines, class action attorney. Attorney Haines has successfully litigated Cisco Systems in the past for similar violations.

Another areas of abuse in recent months among corporate giants, has been pension fraud. When long term employees are laid off or retire, in many instances they realize that their pension balance is not what they thought it would be. In many cases, changes to the pension plan were not properly disclosed to employees and as such, these same employees incurred significant losses. Pension fraud is becoming more and more common in the corporate arena. Employees who are curious as to whether the proper disclosures were made in regard to their pension should compile their pension documents and speak to a labor attorney as soon as possible.

In addition, if you work or have worked for Cisco Systems and were deprived of your overtime pay it is important to talk to a California labor law attorney at once to investigate your options.

If it is determined that you have been misclassified and are entitled to California overtime pay, you may also be entitled payment of penalties and interest as well as your attorney fees. It is as simple as putting together your job description and any performance evaluations you might have and submitting them for attorney review.

In difficult times of lay offs and downsizing, employees must become informed as to what their rights are and investigating your employer for possible misclassification of your job and pension wrongdoing is a prudent step in protecting your rights.
 

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California Labor law requires that employees be reimbursed for their work related expenses, such as mileage, supplies, training, tools and equipment and even legal expenses. Alternatively, employers usually have policies and procedures that create deadlines, in order to request and receive reimbursement.

In Stuart v. RadioShack, an employee is suing for reimbursement and RadioShack argues that his claim has no merit because Stuart did not make a proper request under its policies and procedures. So the question is: Do the requirements of the statute override policies and procedures for reimbursement set by the employer?

California Labor Code section 2802 states:
"An employer shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties."
"Any contract or agreement, express or implied, made by any employee to waive the benefits of this article or any part thereof, is null and void."

California employers are required to reimburse employee expenses and employers cannot allow the employees to surrender or limit these rights for any reason. According to the Northern District Court: the employer's responsibility to reimburse expenses should be triggered by the same standard that applies in cases of "off-the-clock" work:
“The Court concludes that a fair interpretation of [Labor Code] §§ 2802 and 2804 which produces “practical and workable results,” consistent with the public policy underlying those sections, focuses not on whether an employee makes a request for reimbursement but rather on whether the employer either knows or has reason to know that the employee has incurred a reimbursable expense. If it does, it must exercise due diligence to ensure that each employee is reimbursed.”

Basically, employers can continue to use their policies and procedures but if they learn about reimbursable expenses that are owed to the employee, the employer should make every effort to reimburse the employee.

If you are concerned that you are owed reimbursable expenses please contact a California labor law attorney to help you claim the money that is owed to you.

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California labor law attorneys fought to prove that it should be illegal to change the beginning and end days of the work week in order to evade 7th day payment of overtime. The California Supreme Court upheld this reasoning and the court also found that all on-call time where employees were required to sleep aboard the employment vessel will be paid as hours worked.

In Seymore v. Metson Marine, Inc., the employees were scheduled to work 14days on then 14 days off. Their primary job function was to attend to marine oil spills. However the Metson Marine designed the work week to begin and end in such a way that they would not have to pay the 7th day overtime pay on the second week (day 14). In other words the employees would be paid for overtime on the 7th consecutive day of work but they would not get paid for the last day of their 14 days. While the court recognized that employers do have the ability to choose the work week for payroll purposes the court noted that Metson Marine designed their work week simply to avoid payment of overtime on the 14th day, due to Metson’s lack of evidence proving anything to the contrary.

California labor law attorneys for the plaintiff were also successful in proving that the employees were not properly compensated for being on call or off duty stand by. Metson Marine would allow the employees to sometimes leave the ship, unpaid, for personal reasons however they required that the employees carry a phone, be within 45 minutes of the ship and they were not to drink alcohol. The court found that Metson Marine should have paid the employees during the on-call times as hours worked because of the restrictions that were placed on the employees during this time.

The California labor law attorneys for the plaintiff asked for payment of the 8 hours during which the employees were sleeping on the ship. Metson Marine did have one victory in this suit; the court held that the sleep time of the employees was subject to payment as time worked.
If you are concerned that you have not been paid properly for being placed on call or standby and or overtime, please contact an experienced California labor law attorney to review your situation.

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California Labor laws give a different set of overtime rules to "ambulance drivers and attendants" who work 24-hours shifts, than the rest of the California work force. Under certain circumstances, the rule allows employers to schedule ambulance drivers to work 24 hours without paying daily overtime pay. The California law states:

"The daily overtime provision of subsection (A) above shall not apply to ambulance drivers and attendants scheduled for 24-hour shifts of duty who have agreed in writing to exclude from daily time worked not more than three (3) meal periods of not more than one (1) hour each and a regularly scheduled uninterrupted sleeping period of not more than eight (8) hours. The employer shall provide adequate dormitory and kitchen facilities for employees on such a schedule.”

In other words, if all the following circumstances are met then the ambulance driver need only be paid for 13 hours:

• Cannot exceed 3 hours of meal periods, of which are not more than 1 hour each
• Not more than 8 hours of regularly scheduled uninterrupted sleep period.
• a written agreement to this effect

It is important to note that this exemption to overtime applies to California daily overtime (for more than 8 hours a work day) but not to California weekly overtime (for more than 40 hours a work week).

In order for the employer to be able to save money by saving overtime hours, the employers must meet the terms of the 24-hour shift rule. For instance, if the sleep time is "on call" instead of scheduled to be uninterrupted, then the employer is not in compliance. If there has not been a written agreement between both parties, then the employer is not in compliance. If the employer is not in compliance then they will be forced to pay its ambulance drivers daily overtime for the entire 24-hour shift.

Aguilar v. Association for Retarded Citizens is a perfect example of what happens when an employer fails to comply with the 24-hour shift rule is. In Aguilar, the ambulance drivers were scheduled to work 24-hour shifts, but the employer would "temporarily released them" for a few hours each day to let them to pursue their personal matters. Basically, they did not work a complete 24-hour shift. The employer had to pay the employees for all hours worked, including overtime pay. To paraphrase, the court reasoned:

The IWC Wage Order outlines the difference between ambulance drivers that work 24-hour shifts and those who work less than 24-hour shifts. The Wage Furthermore wage order affords an exemption from compensation for sleep time only, for ambulance drivers that work 24-hour shifts. It has been made obvious the ambulance drivers here do not work 24-hour shifts.

If you are an ambulance driver, ambulance attendant or EMT and you feel you have not been compensated properly for your 24 hours shifts please contact an experience California Labor Law attorney to review your potential case.

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Outside Salesperson Exemption

The Fair Labor Standards Act (or 29 USC § 213(a)(1) and 29 C.F.R. § 541.500.) defines the"Outside Salesperson Exemption." As a person that;

(a) has the primary duty of (a) making “sales” or (b) obtaining orders or contracts for services or facilities usage, and
(b) is customarily and regularly engaged away from the employer’s place of business in performing such primary duty.

It is also important to note that the employee must spend over 50% of their working time actively selling or obtaining new business away from the office and or home office, if applicable. As oppose to delivering product, giving product training or other administrative tasks unrelated to the actual sale of the product or services.

Inside Salesperson Exemption

The other second part of the salesperson exemption applies to primarily commission-based salespeople and is commonly referred to as inside salesperson exemption. Section 7(i) of the Fair Labor Standards Act (29 USC § 207[i]) will exempt a particular employee from overtime compensation if:

(a) the employee is employed in a “retail or service establishment,” and
(b) the employee’s regular rate of pay exceeds one and one-half times the applicable minimum wage, and
(c) more than half the employee’s compensation for a representative period represents commissions on goods or services.

“Regular rate of pay” referenced in the above federal test, applies on a work week basis. This means that the average of compensation for two or more weeks does not satisfy this requirement.

If you feel you are not being compensated properly for your work as a sales person please contact a California labor law attorney to discuss your case.
 

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California labor law defines a discretionary bonus as follows:

“Discretionary bonuses or sums paid as gifts at a holiday or other special occasions, such as a reward for good service, which are not measured by or dependent upon hours worked, production or efficiency, are not included for purposes of determining the regular rate of pay.”

This seems pretty straight forward; right? However, the term discretionary is misleading because neither party ever truly has absolute discretion due to "implied covenant of good faith and fair dealing". All California employment situations are subject to "implied covenant of good faith and fair dealing", whether you have an actual employment contract outlining the terms of your employment or if you are an at will employee. This doctrine monitors parties in contracts where one party has the right to exercise broad discretion that affects the other party's rights. California labor law states when that party exercises their discretion it generally must be done "fairly".

For instance, let’s say that there is an investment banker that is usually paid an annual bonus of around $100,000. Then one year the employer decides to give the employee a bonus of only $20,000 even though the employee had one of his most productive years and was out performing his peers. Come to find out, the employer was going to lay off this employee in a few weeks and had decided to distribute the remainder of his bonus to the other employees.

This is a perfect example of where the implied covenant applies to California employment law cases. If an employee performs satisfactory work during the year with the anticipation that he would be given a bonus similar to his coworkers and to what he traditionally received in previous years, the employer does not exercise discretion in "good faith" by paying him thousands of dollars less than they do to similar employees.

This might be an extreme case for most employees, but the same concepts can be applied to any bonus and even Christmas bonuses in certain circumstances. If you feel you have not received a fair bonus please contact a California labor law attorney to review your case.
 

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Recently in San Francisco’s 9th Circuit Court of Appeals Oral arguments were heard on Campbell v PricewaterhouseCoopers. This a is a wage and hour case in which the employees, unlicensed audit associates, are claiming that they have been misclassified as exempt and are owed overtime. If the plaintiffs are successful at recovering their overtime it will open the door for more class actions brought by similarly situated employees.

The counsel for the plaintiffs presented their argument to a panel of three judges. The briefs read as follows:

“PwC argues that Attest Associates satisfy the Professional Exemption because—notwithstanding the routine and nondiscretionary nature of their work—PwC claims that they are functionally indistinguishable from fully licensed accountants, doctors, lawyers, and engineers. As a matter of law, however, the text, structure, and drafting history of the Professional Exemption limit its application to licensed accountants, and Associates are not licensed. Second, PwC argues that Attest Associates satisfy the Wage Order’s Administrative Exemption because they work “under only general supervision” despite up to six layers of managers who are responsible for Associates’ work. That argument fails, however, because PwC has not pointed to sufficient evidence to create a triable issue of fact that Associates “work along specialized or technical lines”—much less that they do so “under only general supervision”—as required by the Administrative Exemption.”

PricewaterhouseCoopers counsel argument was as follows:

“Put simply, nothing in the Wage Order precludes unlicensed accountants from being shown to be exempt under subsection (b) of the Professional Exemption. Plaintiffs’ argument that the “drafting history” of the wage order at issue shows an intention on the part of the [Industrial Welfare Commission] to prohibit unlicensed accountants from being professionally exempt should be rejected, because the language and structure of the Professional Exemption are not ambiguous, and contain no such prohibition. Even the District Court did not accept Plaintiffs’ tortured reading of the text of the Professional Exemption, or claim to find unambiguous intent on the part of the [Industrial Welfare Commission] to exclude from eligibility for the Professional Exemption all unlicensed members of the accounting profession — and inevitably by extension, all unlicensed lawyers, doctors, dentists, optometrists, architects, engineers, and teachers. Doing so is flatly contrary to the overriding principle governing application of exemptions from overtime provisions, which is to consider individual employees’ work duties.”

The employees’ position essentially is that they are not exempt under either the professional exemption or administrative exemption because they argue that they are neither working in a specialized or technical role nor are they given the requisite discretion over how they may carry out their work to qualify as exempt from overtime.

PricewaterhouseCoopers argues that the tasks that auditors perform are not that different from the tasks a licensed accountant performs. Licensed accountants do fall under the professional exemption therefore auditors should as well. They further argue that the exemption status should be based on the job duties or tasks that the employees perform and not on whether or not they are licensed.

The court has not given its ruling but clearly has a lot to consider.

If you hold a position in accounting and are currently being paid a salary you may be owed overtime. If you have any questions it is advisable to contact a California labor law attorney to discuss your situation.

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The Myth of Salary

There are myths regarding California overtime that suggest employees that are compensated with a salary are not entitled to overtime. This myth comes from the requirement of certain California overtime exemptions that the employee be paid a salary. That requirement is just one of many -- and it is the easiest to meet. The fact remains that there are many people who are paid a salary that are entitled to overtime, and there are many people who are paid hourly that don’t get any overtime. Suffice to say that if someone told you that you are not entitled to overtime just because you are paid a salary, that is just plain wrong.

If you are paid a salary, you are still entitled to overtime unless you meet all of the requirements for one of the California overtime exemptions. These added requirements are not easy to meet and many people simply do not meet them. If you have questions about whether your particular job would be entitled to overtime, you can contact a California labor law attorney to assist you in evaluating your claim.

The “Supervise Two People” Myth

Another California overtime myth is that if you supervise two or more people, you are exempt. This one has a little more factual basis than the one above, but is still far from accurate. One of the requirements for the Executive Exemption is that you must supervise at least 2 people. However, this requirement is only one of many. In addition, the law has regularly been interpreted to find that supervising only 2 people would rarely require sufficient supervisory time to satisfy the exemption since you must spend over one half of your time performing supervisory duties. As you can read in the Executive Exemption section, the exemption is very hard to meet and only true executives of the company will qualify for it.

If you are a “team lead”, “project manager”, or “development manager,” you can still be entitled to overtime. Of course, job titles do not control whether or not you are entitled to overtime, and your actual right to overtime will depend on what actually do for your job.

California also has history of requiring overtime for managers who spend more than 50% of their time doing the same work as their subordinates.

Comp Time Given For Overtime Hours Worked

A common practice for some employers is to give “comp time” in exchange for overtime hours worked. That is, if you work 48 hours one week, you can take a day off the next week. There are many problems with such a policy. An important one is that if you worked 48 hours in one week, then 8 hours would be paid at the overtime rate of 1.5x. Thus, you really have 12 hours of pay at the regular rate and giving you 8 hours as “comp time” shorts you 4 hours. In any case, California labor code 204.3 requires that employers are not allowed to use any “comp time” programs that take overtime from one week and give time off in another week.

If you have experienced any of these issues you should immediately seek counsel from an experience California labor law attorney.

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California Labor Laws require that all Non-exempt hourly employees must be compensated at an overtime rate of pay for overtime hours. The overtime rate is determined by applying a multiplier of 1.5 or 2.0 to the employees' "regular rate of pay." The regular rate of pay is often the employees' straight time rate of pay, but not always. Many employers fail to include other types of compensation when calculating the regular rate of pay, which may result in considerable liability for unpaid wages. Recent class action cases highlight the employer’s risk arising out of these miscalculations.

California Labor Laws require that the regular rate of pay must include all types of remuneration earned by the employee. Take for example, restaurant employees whose compensation includes a lunch and dinner provided during their shifts. If their rate of pay is $10 per hour, in an eight hour shift they will be paid $80. However, their regular rate of pay must be calculated by including the value of the meals (figured as the lesser of their actual cost to the employer or the fair market value). If each meal costs the employer $7, that is the equivalent of an extra $14 per day in compensation. The employees are therefore receiving a total of $94 per day in compensation, or a "regular rate of pay" of $11.75 per hour. Accordingly, the employees' overtime rate would be $17.63, not the $15 that might be calculated for a $10 per hour employee.

In this illustration, failure to properly calculate the regular rate of pay would result in a shortfall of $2.63 for every overtime hour worked, leading to potential liability for penalties under PAGA and Labor Code Section 203, liquidated damages under the FLSA, interest, and attorneys' fees. These shortfalls are more common than is often realized and can result from payment of many kinds of bonuses or incentives, mandatory gratuities (such as a mandatory 15% tip for groups of 5 or more at a restaurant), free or subsidized lodging, or winning a free trip or prize for hitting a sales target. If you offer discounts, bonuses, incentives, rewards, or anything of value to your hourly employees beyond their base wages, the labor code requires that these additional forms of compensation be included in an employees regular rate of pay to calculate his or her overtime rate unless an exception applies. Although exceptions do exist for certain categories, the exceptions are limited and highly fact-specific.

If you suspect you have not been paid overtime properly you should consult a California labor law attorney to evaluate your situation.

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According to California Labor Law if an employer sends its hourly, nonexempt employee home before the end of a shift, that employee may be entitled to additional compensation, known as “reporting time pay.”

Section 5 of the California Industrial Welfare Commission IWC wage order, provides that when anemployee reports to work but is not allowed to work or completes less than half of a shift (half shift is calculated at four hours) before being released for the day then the employer must pay that worker for at least one-half of that day’s pay.

Section 5(B) of the wage order provides that if the employer calls the employee back to work that day and only allows the employee to work less than two hours then the employer must pay its employees an additional two hours of pay.

There are a number of exceptions as follows:

1. Company operations don’t start or cease due to threats to employees or property
2. There is a failure of public services (electricity, water, etc.)
3. Natural disaster, etc. “not within the employer’s control.”

An employee will not qualify for additional compensation under this rule if he or she is not able or capable to work or if the employee came to work late or was fired or sent home as a disciplinary action.

Reporting time pay for hours in excess of the actual hours worked may not be counted as hours worked for purposes of determining overtime compensation.

These rules do not apply to workers who are exempt and paid a salary in that a salaried employee receives his or her full salary regardless of hours worked.

If you have experienced being released from work early and therefore you have not been paid a minimum of four hours, you may demand your unpaid minimum hours (“reporting time pay”).

If you have any questions it is advisable that you contact a California employment attorney to review your situation.

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California Labor Laws dictate that, non-exempt employees are typically entitled to time and a half for hours worked over eight in a workday, and the first eight hours on the seventh consecutive day of work. Labor Code Section 510 also requires payment of twice the employee's regular rate for work in excess of 12 hours in one day and “any work in excess of eight hours on any seventh day of a workweek.”

A common question that arises is, whether this provision requires employers to pay double time for hours worked on the seventh day of the workweek or the seventh consecutive day of work. The Industrial Welfare Commission's draft interim-wage order states that employers are required to pay premium wages for the seventh consecutive day of work.

For example: if the employee works seven days in a work week (regardless of total hours worked), on the seventh day the employee will be paid 1.5 times their regular wage for hours 1-7. Starting on the 8th hour the employee will be paid twice their regular rate.

It’s important to also note that the seven consecutive days must fall within the same workweek. Thus, if an employee works four consecutive days (e.g., Thursday to Sunday) and then works the first three days of the following workweek (Monday to Wednesday), he or she would not be entitled to seventh-day premium pay for work performed on Wednesday.
 

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California labor laws are rather specific in regards to how employers should pay employees on a “piece rate” basis; employers are obligated to pay overtime when the employees work over 40 hours in a workweek. A recently filed class action overtime suit illustrates the dangers of making the assumption that overtime is not owed to piece rate workers. The suit, Case No. 6:10-cv-00346, N.D. New York, alleges that Wave Comm, an Arizona-based cable company, failed to pay overtime to its cable installation technicians.

Piece rate or piecework is defined as work paid for according to a set rate per unit. Webster’s Collegiate Dictionary. A piece rate must be based upon an ascertainable figure paid for completing a particular task or making a particular piece of goods. The piece rate earned must equal or exceed the State’s minimum wage rate for all hours worked. (See appropriate IWC Order and Minimum Wage Order and DEPARTMENT OF INDUSTRIAL RELATIONS DIVISION OF LABOR STANDARDS ENFORCEMENT document DLSE-2005-W-1 Revised 6/2005)

The technicians were paid a fixed amount of money for different types of installation-related tasks, but did not receive overtime compensation for the numerous weeks in which they worked overtime hours.This is not the first suit such filed by these types of technicians against the cable industry.

Even though paying employees on a piece rate basis is permissible under both the FLSA and state law, employees should be aware not only of their entitlement to be paid overtime, but the specific formula for used to calculate the amount of overtime pay. In general, when an employee is paid solely on a piece rate basis and works overtime hours, the employer determines the employee’s regular rate by dividing the employee’s total weekly earnings by the amount of hours worked in that workweek. The employee is then entitled to one-half of the regular rate for each hour worked above 40, in addition to their regular piece rate compensation.

For instance, if an employee paid on a piece rate basis works 45 hours and earns $360.00 in that workweek, the employee’s regular rate for that workweek would be $8.00 per hour. The employee would then be entitled to an additional $20.00 in overtime (half the regular rate, or $4.00, multiplied by five overtime hours). In that workweek, the employee would receive $380.00 in total compensation.

It is also acceptable to pay piece rate employees one and a half times the piece rate for each “piece” produced during the overtime hours, provided that this is agreed to in advance and that the piece rate exceeds minimum wage and is paid for all hours worked up to 40 in the workweek.

If you believe that you may have received your all amounts you earned as a piece rate employee it is recommended that contact a California Employment Attorney to make sure your rights are protected.
 

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The battle lines have been drawn over the question of how the term "EMPLOYER" should be defined. Should the term "EMPLOYER" simply mean only the company that hired the employee which is the old common law definition or should the term "EMPLOYER" take into account broader principles of California Labor Law.

A major case was just decided by the California Supreme Court that established who can be held liable for failure to pay wages. A number of cases were previously herd in which only the company who was the direct employer could be held responsible for any unpaid wages.

There were a number of cases including Reynolds v. Bement (2005) 36 Cal.4th 1075, in which the Court “looked to the common law rather than the applicable wage order to define employment in an action under section 1194 seeking to hold a corporation's directors and officers personally liable for its employees' unpaid overtime compensation.” Labor Code section 1194 gives employees the right to recover “the legal minimum wage or the legal overtime compensation.”

The California Supreme Court has ruled on one of the most important wage and hour cases and that is Martinez v. Combs 49 Cal.4th 35 (2010). This case explains who is and who is not an "EMPLOYER" under California wage law and it includes a number of important rulings that will shape California wage and hour practice for years to come as well as California Labor Law in general.

By way of background, the question of who must pay minimum wage or overtime under section 1194 has been addressed only once since 1913, when California passed its minimum wage law. That one decision was Reynolds v. Bement (2005) 36 Cal.4th 1075, in which the Court “looked to the common law rather than the applicable wage order to define employment in an action under section 1194 seeking to hold a corporation's directors and officers personally liable for its employees' unpaid overtime compensation.”

The main argument that was put forth in Martinez v. Combs was that the history of section 1194 showed that the legislature intended to give the Industrial Welfare Commission (IWC) the power to define various terms used in the regulations that the IWC had the power promulgate. Within the definition of employer the regulation under Wage Order No. 14, Cal. Code Regs., tit. 8, § 11140, subd. 2(C) use the term defining employer as one who “suffered or permitted an individual to work”. Wage Order No. 14, Cal. Code Regs., tit. 8, § 11140, subd. 2(F) describes employer as one who “exercises control over wages, hours, or working conditions”.

The power of the Industrial Welfare Commission (IWC) to define employment is not expressly granted in the act creating the IWC but merely implied, and thus extends only so far as necessary to permit the IWC effectively to exercise its expressly granted powers to regulate wages, hours, and working conditions. West's Ann.Cal.Labor Code § 1173 et seq. Therefore regulations issued by an administrative agency such as the Industrial Welfare Commission (IWC) under a delegation of legislative power must be reasonably necessary to effectuate the purposes of the statute. West's Ann.Cal.Labor Code § 1173 et seq. and therefore has the force and effect of law.

The California Supreme Court stated that in actions under section 1194 to recover unpaid minimum wages, the IWC’s wage orders do generally define the employment relationship, and thus who may be liable. An examination of the wage orders’ language, history and place in the context of California wage law, moreover, makes clear that those orders do not incorporate the federal definition of employment. Applying these conclusions to the facts of the case, the Supreme Court affirmed the Court of Appeal’s judgment.

As set forth in the Supreme Court’s ruling it stated that the Wage Orders set forth a multi-pronged, disjunctive definition of employment: an employer is one who, directly or indirectly, or through an agent or any other person, engages, suffers, or permits any person to work, or exercises control over the wages, hours, or working conditions of any person. The “engage, suffer, or permit” component of the definition does not require a common law “master and servant” relationship, but is broad enough to cover “irregular working arrangements the proprietor of a business might otherwise disavow with impunity.” Phrased as it is in the alternative (i.e., “wages, hours, or working conditions”), the language of the IWC's 'employer' definition has the obvious utility of reaching situations in which multiple entities control different aspects of the employment relationship, as when one entity, which hires and pays workers, places them with other entities that supervise the work. Finally, the IWC’s “employer” definition is intended to distinguish state law from the federal FLSA and is therefore controlling.

This case becomes extraordinarily significant in light of the fact that individual company owners cannot hide behind their corporations to shield them from personal liability. The law clearly states that anyone who directly or indirectly permits a person to work or exercises control over that person's wages, hours or working conditions shall be held personally responsible for the payment of all wages due. This helps to stop those who abuse the labor laws and attempt to deny wages that have been earned. The California Supreme Court has spoken and has upheld the rulings By the California Industrial Welfare Commission which broadly defines who shall be treated as the employer.

If you have any questions with regard to your rights is important that you seek the help of a California Labor Law Attorney so that your rights will be fully protected.

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In this day and age of a computer driven society a substantial amount of technical expertise is required to handle these complex systems which weave hardware and software together in order to maintain computer systems. Those employees working on the front lines whose primary duty is to respond to breakdowns that occur in the systems must diagnose, troubleshoot and resolve complex problems. The fact that this work can require extensive training is not the key criteria for classifying such an employee as "exempt" from the payment of overtime. According to California Labor Law Attorneys the key interpretation is set forth under federal law under the Fair Labor Standards Act (FLSA). In opinion letter (FLSA 2006-42, dated October 26, 2006) published by the Department of Labor (DOL) this issue is discussed with regards to the job of an IT Support Specialist.

Two possible exemptions are discussed, the administrative exemption and the computer employee exemptions.

In looking at this analysis it is important to keep in mind that both the federal labor laws and state of California Labor Laws require employers to pay nonexempt employees a minimum wage for all hours worked and an overtime premium equal to at least one and one half times the employee's regular rate of pay for all hours worked in excess of forty hours in one week.

ADMINISTRATIVE EXEMPTION

The "white collar" exemptions provide overtime pay exemptions for any individual employed in a bona fide executive, administrative or professional capacity as those terms are defined in 29 C.F.R. Part 541. In order for this exemption to apply not only must the employee devote a majority of his or her time to analyzing, troubleshooting, and resolving complex problems with business applications, networking, and hardware but the employee must be compensated at the rate of at least $455 per week and has, as his or her primary duty, the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer's customers. Additionally, the employee's primary duty must include the exercise of discretion and independent judgment with regard to matters of significance.

In meeting all these requirements most employees are not found to "exercise discretion and independent judgment with regards to matters of significance" because that term requires the making of decisions that have significant impact on the running of the company that the employee works for. As this term is applied it relates in most instances to upper management who set the course of operations and the overall direction of the company.

The fact that the work is complex or highly specialized along technical lines or that the employer will suffer significant consequences or losses if the employee does not perform the job properly does not automatically mean the work is significant to the management or general business operation of an employer. If the employee meets some but not all of these requirements this exemption will not apply and the employee must be paid overtime unless a different exemption applies.

COMPUTER EMPLOYEE EXEMPTION

There is an alternative exemption Under Sections 13(a)(1) and13(a)(17) of the FLSA, in which a computer systems analysts, computer programmers, software engineers, and other similarly skilled workers in the computer field who meet certain tests regarding their job duties are eligible for exemption from both minimum wage and overtime pay as professionals. In order to qualify for this exemption, the employee must be paid on either a salary or fee basis of not less than $455 per week or, if paid on an hourly basis, not less than $27.63 per hour.

Furthermore, this exemption will only apply to employees whose primary duties consist of the application of systems analysis techniques and procedures, including consulting with users to determine hardware, software or system functional specifications; the design, development, documentation, analysis, creation, testing, or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications; the design, documentation, testing, creation or modification of computer programs related to machine operating systems; or a combination of these duties. Examples of employees who qualify for these duties include computer systems analysts, computer programmers, software engineers, and other similarly skilled workers.

It should be noted that job title alone does not determine the employee's exempt status.

SUMMARY

The rules relating to the various criteria that the employer must meet in order to classify an employee as exempt from receiving overtime. It is important to seek the advice of a California Labor Law Attorney. In many instances initial advice may be given without charge. If there is any doubt the chances are that the position is not exempt from overtime.
 

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United Employees Law Group through this blog, its website and direct discussions by phone, provides information on a multitude of employment issues to those seeking help with California Labor Law issues.

The laws and rules dealing with employment are extensive and complicated. Although there maybe "quick answers" those answers may only scratch the surface and may not provide adequate guidance without a more thorough review. In many instances there is substantial money at stake not to mention other important rights that should be protected.

When someone calls us looking for help, we understand that they are trying to navigate an unfamiliar area where the stakes are high.

This firm has prosecuted well over 1000 cases. Some of which include class action cases against some of the largest Fortune 500 companies. Each of these cases requires an investment of substantial economic resources. This requires that we selectively choose those cases we believe have the greatest chance of success.

To better understand the process the following is an overview of how we proceed when someone seeking help contacts us.

POTENTIAL CLIENTS ARE SCREENED

United Employees Law Group prescreens all clients before their case is accepted. Potential clients are taken through an in-depth analysis to determine the strength and value of their claim.

ANALYSIS OF PRELIMINARY DOCUMENTS

Potential clients are required to send in initial documents for preliminary review. Documents may include pay stubs, job descriptions, along with an employee handbook and evaluations.

FINAL REVIEW

All information provided by the potential client then goes through a final review to determine if the case can be accepted.

CLIENT FEE AGREEMENT

If the case is accepted, a fee agreement is sent to the client, this agreement sets out the scope of services, the clients’ responsibilities and the fees charged. All expenses are advanced by the law firm. No fee or costs advanced are collected, except out of monies recovered by the client. In other words, all work is done and expenses are incurred at the sole risk of the law firm.

INITIAL SCHEDULING OF ALL ACTIONS ON CASE

The first step is to record all information in a specialized computer program that coordinates calendared deadlines, phone calls, meetings and to do's. This information is continually being updated as the case progresses. This same program cross-references all documents and contact information of all parties. For example, the initial steps scheduled include the preparation of various letters along with the entry of a follow-up date.

INITIAL COMMUNICATIONS AND ANALYSIS

A notice is sent to the California Labor and Workforce Development Agency as well as a letter to the employer explaining the nature of the claim and an offer of early resolution.

An investigation of the employer is conducted and a detailed computation is made of unpaid wages, interest and penalties.

DISCUSSIONS WITH CLIENT

Numerous contacts and discussions are made with client in order to refine the information necessary to evaluate the value of the claim and to answer questions that the client may have and to discuss the client’s settlement objectives.

PREPARING FOR LITIGATION

An old and true military motto from Flavius Vegetius, Renatus circa 375 AD: says “If you want peace, prepare for war.” 

This is also good advice when it comes to fighting for the rights of our clients. It is for this reason that we prepare for the possibility that our resolve will be tested and we therefore work closely with our clients to gather facts, documents and witnesses. Although this requires work from both our client and our firm the results are well worth the effort.

SETTLEMENT OR TRIAL

Because this is an unfamiliar process most clients are naturally apprehensive about the prospect that this matter may go all the way to trial. Although a substantial amount of work is done in anticipation of a possible trial, it is much more likely that a settlement will be reached and a trial will not be required. As a matter of fact over 95% of all cases are successfully resolved by settlement between the parties.

INFORMATION IS POWER

Because California Labor Law is complex and could involve substantial sums of money it is important that you seek advice from a California Labor Law Attorney. In most instances this service is provided without charge so you have nothing to lose and everything to gain.

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What does the CALIFORNIA LABOR LAW require IF AN EMPLOYEE IS ON-CALL AND MUST RESPOND QUICKLY TO WORK ASSIGNMENTS; IS THE EMPLOYEE ENTITLED TO BE PAID DURING THE PERIOD HE IS ON STANDBY?

HISTORY:

ALARMCO is engaged in the business of providing security alarm services to retail businesses throughout California. Specifically, ALARMCO provides equipment, installation, repairs and maintenance services.

In order to provide these services, ALARMCO maintains operating agreements with its customers to provide repair and response services. To provide these services, ALARMCO employs a fleet of technicians.

When a service call is requested ALARMCO requires that the technician immediately report in an ALARMCO vehicle to the repair site in uniform.

The practical effect of this on-call schedule and the on-call requirements is that the technicians are effectively under the control of ALARMCO while on standby during the entire on-call week. As a practical matter, the response time and the additional restrictions on the use of the company vehicle and the clothing requirement, means that the on-call technicians must remain at home next to their phone and within five minutes of their ALARMCO vehicle. The technicians are severely limited in the engagement of personal pursuits during the on-call time because of the specified time requirements.

Because they must respond immediately to all calls means that the technicians cannot go to dinner or a movie, attend a concert, travel for a weekend getaway, or have a beer while they are on call wherein they are subject to receiving a call that requires driving in an ALARMCO vehicle to perform on site repair services.

On-call status places technicians in a state of constant readiness 24/7 outside of their regular 40 hour work schedule during the standby week. ALARMCO technicians are expected to respond day or night, dropping all other activities including sleep and meals, and remain on the job until it is completed.

The work required of the technicians while on standby is so regularly scheduled and frequent that the time spent waiting for call requests should be compensable as the technicians are not able to engage in personal pursuits during these standby periods.

ANALYSIS:

On-call time for the technicians constitutes employer “controlled standby” which must be compensated. The legal test as to whether standby time is compensable work time was established by the California Supreme Court in Madera Police Officers Association v. City of Madera, 36 Cal. 3d 403 (1984)

In reaching this conclusion we adopt a two-step analysis. We first examine whether the restrictions on off-duty time are primarily directed toward the fulfillment of the employer’s requirements and policies. Second, we analyze whether the employees’ off-duty time is so substantially restricted that they are unable to engage in private pursuits.

Madera, supra, 36 Cal. 3d at 409.

The on-call schedule, coupled with the strict requirements for response time, arrival time and resolution time substantially restricts the technicians’ off-duty time, rendering ALARMCO liable for all the waiting time spent by the technicians during the standby periods.

Applying the two step process under Madera to ALARMCO’s policies and practices we find that ALARMCO requires that service calls be responded to immediately. The on-call and response time requirements are all directed towards the fulfillment of ALARMCO’s uniform contractual obligations to its customers and in accordance therewith technicians are graded not only on “response” time but also on the time spent actually resolving the call. As a result, the de facto requirement is that technicians drop everything when a call is received, drive to the destination and resolve the service request. These requirements substantially restrict a technician’s personal time while on standby, that he is effectively unable to engage in private pursuits.

SUMMARY:

Simply being on-call is not enough under Madera for standby time to be compensable. The Madera Court affirms that “on-call status, coupled with other factors is required to entitle an employee to compensation.” Madera, supra, at 411. In this situation technicians are not only on-call but are required to immediately respond and resolve the equipment malfunction and do so by reporting in an ALARMCO vehicle while in uniform. Given the high frequency of service calls along with the factors stated above the technicians are effectively subject to the “control” of ALARMCO while on-call.

In reviewing situations such as this whereby various factors must be weighed and considered it should be noted that the wage and hour laws of California are remedial enactments for the “protection and benefit of employees” and therefore the “statutory provisions are to be liberally construed with an eye to promoting such protection.” Ramirez v. Yosemite Water Co., 20 Cal.4th 785, 794_795 (1999). Any doubts should be resolved in favor of the employee.

If you have any questions regarding your entitlement or rights under the California Labor Code consult with a California Labor Attorney who specializes in labor law. In many instances your questions may be handled without charge based on the policies of each law firm.

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You have just made a major decision in your life by selecting a California Labor Attorney to represent you in your claim for unpaid wages.  A substantial amount of money is at stake and you hope that you made the right decision. You find yourself being bombarded with questions to answer and forms to fill out. The process takes on a somewhat mysterious quality and you are trying to steer a successful course. You begin to ask yourself, how can I help to achieve the best outcome and the answer to that question is not all that clear to you.

As in any major undertaking it is important to establish a clear idea of what you hope to achieve. In order to realistically evaluate an answer to that question you must first take into account that you are engaged in a situation that is complex with many moving parts. So let's take a look at the various things that come into play in effecting the outcome of your claim.

• An initial calculation of the claim, interest, penalties and legal fees.
• Review of the evidence provided by the client.
• A determination of who is legally responsible for payment of any unpaid wages.
• An initial evaluation of the financial strength of the company or individuals.
• A discovery plan to secure evidence from the defendants and witnesses.
• An evaluation of the clients’ ability to handle the legal process.
• An estimate of the legal resources and funds necessary to prosecute the case.
• A strategy to prosecute the case taking into account all the elements of the case.

Both the client and the attorney are now bound together by a partnership in which the attorney has the duty to advise his client as to what can realistically be achieved and the steps necessary. In the initial stages it is more difficult to evaluate the outcome that one may expect. As the case progresses and the evidential documents have been obtained, this evaluation process becomes more accurate, although the outcome is never a sure thing.

Through a dialogue between the client and the attorney it is important for the client to share his or her expectations. At first this may seem rather straightforward but in fact there are many elements that need to be weighed which can and does change one's expectations.

It has been my experience in representing clients that they normally take a very realistic approach with regard to what can reasonably be achieved and they work closely with the attorney throughout the process.

Eventually there will be a point in time or possibly various points in time, when a decision will need to be made as to whether or not a proposed settlement should be accepted or rejected. The main factor that will affect the decision to accept or reject an offer can be stated in one word "Predictability". In other words, does it make more sense to accept the offer that is on the table and know the outcome of your case, or is the value of an offer below the amount that you believe makes the risk of going forward the better choice?

At some point an assessment is made by the client that the certainty of receiving a given amount outweighs the risk of a trial, which may or may not result in a better outcome, as well as the possibility that everything could be lost notwithstanding the fact that a settlement results in receiving payment now rather than later. This is the same decision that the defendant must weigh in deciding to make an offer of settlement. In making this decision you have to ask yourself should I go to trial and put my fate in the hands of another.

This reminds me of the television show "Deal or No Deal" (©2010 NBC Universal). In this game show the contestant must guess which case holds the main prize of $1 million. There are 26 cases and in each round of the game he or she selects one case and before opening the case the contestant may either accept an offer of cash to terminate the game or continue playing. The amounts held in each case range from 1 penny to $1 million. As the game progresses the contestant is offered an amount of money to stop the game which statistically takes into account the odds of the contestant picking the right case from the remaining group. The contestant has to decide whether or not to continue taking further chances or to take the amount being offered. If the contestant continues to play the game and fails to pick the case with $1 million before using up all of his or her chances he or she can lose everything. That is why the game is called "Deal or No Deal".

The fact is that over 95% of cases are resolved by a negotiated settlement after a substantial amount of work has been put into the matter by both parties. Although it is expensive to bring a case to settlement it is substantially more expensive not to settle because although the outcome may be better, a loss could be devastating and as the old saying goes "A bird in the hand is worth two in the bush".

This is why it is important to have California Labor Attorneys who are experienced and who can guide you to a successful resolution of your claim.
 

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California Labor Law is an ever changing body of law. It is not uncommon for California employers to accept myth as fact when it comes to dealing with employees and their compensation.

While we have found these violations most common in small to medium employers who do not have the benefit of large HR departments or California labor law attorneys, large employers are surprisingly guilty of some of the same infractions. As such, a slew of California class action cases have been filed in the past 10 years or so making California a hotbed of class action litigation with the extensive protections available to California employees in the workplace.

The four most common mistakes employers make are:

1. Misclassifying an employee as exempt from overtime. This typically means paying the employee a salary and having the employee work in excess of 8 hours in day or 40 hours in a week without paying overtime. Also, it is typical in this scenario to not permit the employee to take a 30 minute uninterrupted lunch break. Both of these examples represent a violation of California labor laws and provide the impetus for a wage claim.

2. Another common scenario is employers having their employees pay some or all of their own expenses related to their employment. It is not uncommon for employees to use their own car for work related errands. In actuality, unless employee related expenses are clearly allocated as part of the compensation of the employee, they must be reimbursed. Use of cell or home phones is another abused area. If an employer is requesting an employee to make calls outside of work hours using their own cell phone or home phone, such charges should be reimbursed.

3. Having a policy of ‘Comp time.” Generally, Comp time means having an employee come in early or stay late, not paying overtime, but instead giving that employee the allowance of coming in late or leaving early on a subsequent day.

4. Vacation Forfeiture is another common problem. When an employee is separated from work, that employee must be paid all accumulated vacation along with their final wages. In addition, a “use it or lose it policy” is also illegal under California labor laws. It is lawful for vacation to be paid out under company policy as wages if not used, however, vacation time does not expire nor can it be taken away once accrued in California.

Our Attorneys have handled over 700 individual cases, and prosecuted over 150 class action cases related to California employment matters.

If you have experienced any of the above violations, it is important to talk to a California labor law attorney immediately.

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This is a true story.

Diane is a bright, well organized and the type of person you ask when it’s critical to get something done. You know the type, always busy, yet never too busy to help. Diane has both a business and a paralegal background and is a go-to person when problems arise.

One day Harvey who is a neighbor approaches Diane seeking her help. Harvey’s business, which was given to him by his father who retired, is in serious trouble and he is unable to stop its free fall into bankruptcy. Harvey’s old approach was to borrow and throw money at the problem. This economy today is not so forgiving and this time Harvey has run out of economic rope.

Diane agrees to see if she can spot the problem and fashion a plan to put this business back on track. Taking into account that the company has been around for many years there was hope that with the right medicine it could be saved.

Diane found that there was a serious lack of financial discipline and the company needed a good dose of belt tightening and record keeping. When she took on this project no one could tell her what was actually in inventory and even if it held of the right mix of items.

Diane worked on this for about three months only asking that Harvey keep her credit card payments current which was a very modest monthly amount as this project was requiring more than a full time commitment and it was running longer than expected.

After the initial three month period Harvey asked her to stay on and promised to bring her in as a part owner if she would continue working full time. Harvey promised to pay her the same amount as he would draw from the company. And like all such promises made in desperate circumstances they tend to be unreliable, but Diane is honest and trusting by nature.

Six more months goes by and Diane is working extremely long hours. She receives only modest payments with the excuse that there is not enough money to pay her what was promised. Again Harvey promised that she will receive what is owed when things turn around. At about the eighth month Diane accidentally finds out that Harvey has been taking substantial payments from the company even though everyone else had to take a pay cut. In response to this discovery Diane tells Harvey she is quitting. Harvey then promises to pay Diane but because funds were tight it would be paid over time and she is to receive part payment right away.

With these new assurances Diane continues working and the company begins making substantial progress with Diane receiving only some payments over the next six months.

Then Harvey drops the bomb; he fires Diane because he figures he is out of the woods. This occurs after Diane dedicated over a year helping Harvey rescue his company. Although there were numerous discussions and agreement about what she is entitled to, nothing was put in writing.

Diane calls on an old friend who is a lawyer and tells her story, feeling like a fool. She knows that these promises should have been memorialized but she was leading with her heart and not her head.

California Labor Law which has evolved from the early 1900’s recognizes the key elements inherent in the relationship between employers and employees. That is, employers have both greater economic strength and bargaining power. And in recognizing this reality labor law has been carefully designed to level the playing field. By design, California Labor Law provides that no one shall work for less than minimum wage and equally important the burden shall be on the employer to keep those records compute the wages owed to their employees.

No law is worth its salt unless it has teeth and under the California Labor Law there is an array of penalties for violating a workers’ right along with the right for that worker to recover his legal fees and interest.

In this case Diane has a very substantial collection of emails which shows that she regularly worked nights and weekends over and above working at the office five days a week. Using this information she was able to reconstruct a reasonable estimate of the time worked. When all her time was added up along with statutory penalties for failing to pay her timely and for violating the California Labor Law for minimum wage (which provides for a penalty equal to 100% of unpaid minimum wage) plus interest, plus legal expenses incurred, Diane’s claim is well in excess of $150,000. When her claim is computed using the wages promised she will be entitled to over $250,000.

Now is that a happy ending or what!

It is important to seek legal advice with a California Labor Law Attorney if you have any questions regarding your rights, don’t guess and don’t assume. Sometimes you have to put embarrassment aside and you will be surprised how powerful California Labor Law is and it is on your side. It’s time to level the playing field.
 

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Once you are on the job and under the control of your employer your workday starts and at days end when you leave your workday stops. Does your workday actually start and stop when you clock in or out? Not necessarily.

This is a story that shows there is more to this issue than one might think.

An employee arrives at work in the morning, has a quick meeting with her supervisor and then she starts up her computer. The employee then logs onto the computer by typing her user ID and password and hitting "Enter". Once that process is complete, the employee logs into the System. She then opens any programs or applications she needs to perform her job. At the end of the day, the employees are required to follow the process in reverse logging off and closing down her computer.

Until that employee is logged in and on line she is not able to enter her start time. At the end of the 

day she is required to first sign out and then completes the log off procedure.

This system does not allow an employee to be paid for the time spent at work before she is able to log on by starting up her computer as well as being required to sign out and then closing down her computer. This time adds up to more than 25 minutes each day.

There are other examples of work time that must be compensated for under the law that could be overlooked,

including changing into uniforms or work and safety clothing. Also included is the afterhours preparation of paperwork and the scheduling of appointments for the next day.

Over the years the amount that is owed to an employee could and does add up into the tens of thousands of dollars including penalties and interest.

An example of the penalties that may be relevant and that would add substantially to the amount owed by the employer is as follows:

1) Unpaid Overtime in Violation of California Labor Code Section 510 and Wage Orders No. 4-2001;
2) Unpaid Overtime (Fair Labor Standards Act);
3) Knowing and Intentional Failure to Comply with Itemized Employee Wage Statement 

Provisions (Labor Code § 226(a));
4) Failure to Pay Minimum Wage (Labor Code §§ 1182.12, 1197);
5) Failure to Pay Minimum Wage (Fair Labor Standards Act);
6) Violation of Labor Code § 2699; and
7) Unfair Competition in Violation of et. seq.

All of these claims are premised upon the employee’s right to be paid for the time spent at work.

California law defines the term "hours worked" as "the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so." That does not mean that the mere fact that an employer required an employee to do something renders the time spent doing the activity at issue qualifies as "hours worked". For example, the California Supreme Court has acknowledged that an employee's commute is not compensable simply because "the employees would not commute to work unless the employer required their presence at the work site." The level of the employer's control over its employees, rather than the mere fact that the employer requires the employees' activity, is determinative.

Generally, if you believe you may be owed any back compensation you may make a claim going back up to four years.

It is not difficult to request a free preliminary opinion that helps you understand your rights and if you should consider filing a claim for any unpaid wages.

Being informed could be worth tens of thousands of dollars in your pocket.

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It is not unusual for employees to reach into their own pocket to pay expenses that relate to their job. A typical list includes the following:

• Using your car for business
• Cleaning clothing required to be worn at work
• Purchase, maintenance or loss of tools and equipment
• Expenses related to attending training or educational materials
• Travel
• Cell phones
• Lodging and meals
• Entertainment

An easy way to figure out if an expense should be paid back to you is to simply ask yourself the following question:

“Is this an expense that my company expects me pay for their benefit?” If the answer is yes you are probably entitled to be reimbursed.

To state it another way, the law requires employers to pay employees for any business expenses that arise out of an employee’s reasonable performance of job duties.

For example, if an employee must drive a car (other than to commute to and from work), pay for client entertainment, or make cell phone calls then Section 2802 of the labor code requires the employer to reimburse the employee for the expense.

An employee is entitled to recover all or a portion of unreimbursed business expenses that was paid in the last four years even if he agreed to forgo reimbursement, took an amount that is less than his costs or agreed a salary or commission that was supposed to include reimbursement for these expenses.

This law also covers anyone who was misclassified as “independent contractor”. There are many instances where a person believes he is an independent contractor but in fact is an employee. It does not matter if the error was made by an honest misunderstanding or intentionally. It also does not matter if the misclassification was made by the employer or the employee. It is the law that decides who is an employee and all the rights given to employees.

The law specifically requires an employer who provides a fixed expense allowance or an enhanced commission rate, ensure that expense
reimbursement payments fully cover all necessary expenses. The enhanced portion of any compensation that is supposed to cover all expenses paid by an employee must be identified by the employer by setting forth the method or formula used.

It is the employer’s obligation to show that all expenses incurred by its employees have been fully reimbursed because Labor Code Section 2804 forbids an employer to permit an employee to waive the right to reimbursement. Employees must be reimbursed for all necessary expenses of the employer.

Employers are liable for business expenses even when an employee has failed to submit required expense reports. The law focuses not on whether an employee requests reimbursement but rather on whether the employer either knows or has reason to know that the employee has incurred a reimbursable expense. If the employer has that actual or constructive knowledge, then it must exercise due diligence to ensure that the employee is reimbursed.

An employee should not pass up his right to receive reimbursement because no claim was made in the past or there is little or no documentation. This could occur when an employee does not understand his rights was misinformed or was discouraged from making a claim.

Not only does an employee have the right to reimbursement for business expenses but has the right to recover attorney’s fees, interest and penalties.

We as California labor lawyers know that an employee is not like a company that has the money to pay attorneys to protect them. That is why our law firm provides representation paid solely from money that we recover from the employer. In other words we help level the playing field.

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If California labor law’s dictate you should be classified as a non-exempt employee,  in which you are entitled to overtime pay at 1 ½ to 2 times your straight time rate. And you are promised bonuses for reaching certain goals or you are entitled to commissions, then according to California labor law’s a special calculation must be made that increases your regular hourly overtime rate.   California wage law provides that when a non-exempt employee works hours in excess of eight in any workday or 40 in any workweek, employers must compensate the employee at 1 ½ to 2 times the employee’s regular rate of pay depending on the total number of hours worked. The “regular rate of pay” comprises more than just the employee’s hourly rate of pay it includes many different kinds of monetary remuneration an employee earns for his labor, including commissions and bonuses. 29 U.S.C. 207(e). 

When calculating the regular rate of pay, employers must follow specific rules depending on the type of income in question. Where an employee earns commissions or bonuses, the Department of Labor Standards Enforcement (“DLSE”)  uses the following rule to incorporate the additional compensation into the employee’s regular rate of pay:

“Compute the regular rate by dividing the total earnings for the week, including earnings during overtime hours, by the total hours worked during the week, including the overtime hours. For each overtime hour worked, the employee is entitled to an additional one-half the regular rate for hours requiring time and one-half and to an additional full rate for hours requiring double time.” DLSE Manual, Section 49.2.1.2 

For example, one type of incentive compensation may provide additional compensation if the store performs at a certain level. A company’s bonus plan could provide that a bonus will be paid to employees for increasing sales of specified products, increase profitability, improve customer handling and enhance quality of service. It could be referred to as an Incentive Program that requires employees to reach attendance goals to be eligible. The plan may also specify the payout schedule: eligible employees receive both quarterly and year end payouts. Another type of incentive may also pay certain hourly employees additional compensation, or a commission, for the sale of various products.

Employers must include these nondiscretionary bonuses along with other earnings to determine an employee’s regular rate on which overtime pay is computed. A bonus is “nondiscretionary” if the employer makes a promise to pay it based on the requirements being met. This includes bonuses designed to induce the employees to work more steadily, more rapidly or more efficiently, to remain with the employer, to meet attendance goals, individual or group production bonuses and bonuses for quality and accuracy of work. 29 C.F.R. 778.211(c). 

In any pay period in which a bonus has been earned the employer must recalculate the rate of pay upon which overtime for that pay period is calculated. The employer must add together all compensation earned for the workweek and then divide the compensation by the number of hours worked.


These Bonuses and Commissions Must be Timely Paid

Generally speaking, commissions and bonuses are due and payable after the employee did what was required and the amounts could reasonably be computed. Commissions are considered earned only after the happening of that event designated in the agreement with the employee so long as the event is reasonably tied to the calculation. DLSE Opinion Letter, 2002.12.09-2. 

If for example a commission is earned when the sale is made then that is the date from which all calculations are made.

Labor Code section 204 designates the time frame in which an employer must pay its employees. Wages earned by any person in any employment are due and payable twice during each calendar month, on days designated in advance by the employer as the regular paydays.

Section 204(b)(1) allows an employer additional time to pay commissions in the next pay period but only if it also itemizes the subsequent wage statement by including detailed information regarding the wages that it could not pay on time. Each wage component must be separately listed and specifically list the dates for which it is applicable.

The amount that an employee is short changed may not sound like a lot of money at first, when just looking at just a couple of pay periods. But the amount increases well into the tens of thousands of dollars when a claim includes up to four years of back wages plus interest and plus penalties.

Now you know.

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California labor law attorneys have been working “overtime” to assist employees in collecting additional pay for working split shifts. According to the California Industrial Welfare Commission, a split shift is defined as “a work schedule, which is interrupted by non-paid non-working periods established by the employer, other than a bona fide rest or meal period.”  If such a schedule is worked then the employer must pay a “split shift differential,” which is equal to at least all hours worked multiplied by the minimum wage, plus an extra hour of minimum wage (unless the employee resides at the place of employment). The rationale is that an employee should receive a higher wage in exchange for working outside the normal shift period. The split shift differential only applies to non-exempt employees who are compensated at or slightly above the minimum wage. If the employee is paid significantly above the minimum wage, then the compensation minimum is already met and the employer does not need to offer the extra hour of minimum wage. 

Some employers attempt to avoid paying the split shift premium by forcing an employee to take longer breaks or multiple breaks during the day. This issue is complicated because California law provides that an employer must provide meal and rest breaks. An employer may not employ an employee for more than five hours per day without providing a meal period of at least thirty minutes. However, if the employee works no more than six hours per day, the meal period may be waived by consent of both parties. A second thirty minute meal period must be provided if the employee works more than ten hours per day. If no more than twelve hours are worked per day, then this second meal period may be waived by consent of both parties if the first meal period was not waived.  For example, a work day may look like this:

8:30-1:30 (5 hours)
1:30-2:00 Required meal break
2:00-7:00 (5 hours)
7:00-7:30 Required meal break
Then any additional hours

Although the thirty minute breaks are mandatory, the law does not prohibit an employer from requiring longer breaks. If a longer break or additional breaks are provided, the question then becomes whether the break period is reasonable. If a two or three hour break is required, it is more likely that the schedule would be considered a split shift and the premium must be paid. 

If you believe you are working a split shift and not being fairly compensated, contact an experienced California labor law attorney for an unbiased evaluation of your situation.
 

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California underwriters may indeed be owed overtime pay. This job title and the duties of underwriters, at least at one bank, have been examined in a recently decided case called Davis v. J.P. Morgan. In this case the court in the second circuit decided that underwriters approved loans under established company guidelines and their duties are for the most part non exempt duties and therefore these employees are entitled to overtime pay.

Under Federal regulations, if an underwriter works in a bona fide administrative capacity, if they perform work "directly related to management policies or general business operations" and "customarily and regularly exercises discretion and independent judgment, then they are likely classified as an exempt employee." This is different than an employee who may work in a "'production' or, in a retail or service establishment, 'sales' work." 

In Davis v. J.P. Morgan, underwriters at Chase were primarily responsible for selling loan products under management's guidelines. As the Second Circuit put it, "Underwriters were given a loan application and followed procedures specified in the Credit Guide in order to produce a yes or no decision."

California Underwriters being misclassified as exempt employees might be common issue for all underwriters in this profession in California. If the California courts follow this ruling and others like it, thousands of California underwriters could be entitled to overtime pay. Some of the largest institutions employing underwriters in California are Citigroup (NYSE: C), J.P. Morgan (NYSE:JPM)   Bank of America (NYSE:BAC) and Wells Fargo (NYSE:WFC)

Underwriters in California, if owed overtime pay, may collect up to 4 years of back pay under the liberal California overtime pay laws.

If you are a California underwriter and would like to find out if you are entitled to overtime pay, it is wise to contact a California labor law attorney.
 

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Given the dismal state of the economy, many California workers are walking around with the possibility of being laid off looming over their heads. Even if they are not laid off, they may see their work schedules and salaries reduced. Many companies are using temporary schedule and salary reductions to cut costs until business conditions improve. The key for affected employees is to know the guidelines for such reductions.

First and foremost is the question of whether affected employees have exempt or non-exempt status. Under California law, all employees are considered to be non-exempt, meaning that they are entitled to overtime pay. The only exception is for those employees that meet all the requirements of an applicable exemption, most commonly the executive, administrative, or professional exemptions. To qualify for these exemptions an employee must pass the salary test and duties test. The salary test requires an employee to earn a monthly salary that is no less than two times the minimum wage for full-time employment. The duties test requires an employee to be primarily engaged in managerial responsibilities.

With respect to non-exempt employees, it has long been established that an employer may temporarily reduce their workers’ schedules and wages. The issue is a bit more complicated for exempt employees. According to the California Department of Labor Standards Enforcement (DLSE), theLabor Code and Industrial Welfare Commission wage order provisions nor federal law prohibits an employer from reducing the work schedules and salaries of exempt employees. Therefore, absent an employment contract or other agreement that states otherwise, an employer can reduce an exempt employee’s salary as long as they continue to earn more than twice the minimum wage and engage in exempt job duties.

One restriction is that the salary reduction cannot be linked to any corresponding change in days and hours worked. For example, an employer could not reduce an employee’s salary by 15% in exchange for giving them Fridays off. According to the California Department of Labor Standards Enforcement (DLSE), this type of salary reduction structure would violate the salary test and destroy the employee’s exempt status and non-exempt labor requirements such as meal and rest breaks would apply. The rationale is that exempt employees are paid for their work product regardless of the amount of time they take to complete their duties. Tying work hours to earnings is not in accord with being a salaried employee. 

Another consideration is that the salary reduction should also apply to all exempt employees or at least everyone with the same job duties. Applying a reduction to only certain exempt employees could violate anti-discrimination laws.

If your employer is attempting to reduce your work hours or salary, contact an experienced California labor law attorney. An attorney can advise you of your rights and evaluate your specific employment situation.
 

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Most people during the holiday season excitedly open their mailboxes in the hopes of finding cheerful greeting cards. Sadly, this is not the case for so many hard-working California employees who have lost their jobs this year. Many of these workers are checking their mailboxes not with a joyful spirit, but rather an anxious anticipation of receiving their much needed final wage checks. The good news is that employers will have to pay for causing this type of stressful delay.

Under the California Labor Code, discharged employees are entitled to immediate payment of wages for time worked. “Discharged” employees include those who have completed a specific assignment or period of work for which they were hired.  In the case of a termination, all “wages earned and unpaid at the time of discharge are due and payable immediately.” (Labor Code Section 201) In the event of resignation, payment must be made within 72 hours. (Labor Code Section 202)
Failure to issue payment within the aforementioned time constraints may subject the employer to a “waiting time” penalty. For each day wages go unpaid, the employer will be accessed an amount equal to the employee’s daily rate of pay for up to a maximum of thirty days. (Labor Code Section 203) The inability of an employer to pay wages will not preclude the accrual of penalties.

While application of this penalty may seem straightforward, there are several nuances that all employees should understand. First and foremost, employees will not be awarded penalties where they avoid or refuse to receive payment of wages; for example, secretly leaving the workplace and failing to provide the employer with future contact information. Employers are not required to pay wages without question. If a “good faith dispute” exists concerning the amount of wages due and owing to an employee, the employer may delay payment without penalty. As the California Department of Industrial Relations explains:

A "good faith dispute" that any wages are due occurs when an employer presents a defense, based in law or fact which, if successful, would preclude any recovery on the part of the employee. The fact that a defense is ultimately unsuccessful will not preclude a finding that a good faith dispute did exist. However, a defense that is unsupported by any evidence, is unreasonable, or is presented in bad faith, will preclude a finding of a "good faith dispute". Labor Code Section 203 and Title 8, California Code of Regulations, Section 13520

When a “good faith” defense is asserted, employees are still entitled to immediate payment of the portion of wages not in dispute. If the employer delays payment of undisputed wages, waiting penalties will still be accessed. (Labor Code Section 206)

Employees must also be aware that they only have a fixed amount of time in which to file a claim to collect wages and waiting time penalties. If both final wages and penalties are being claimed, the statute of limitations is four years. On the other hand, if only waiting time penalties are being claimed, then the statute of limitation is one year. 
Consequently, if you are waiting for payment of final wages or believe you may be entitled to penalties, you should not wait to take action.

Strategy:

1. At the time of discharge, remind your employer that they are obligated to immediately pay your earned wages and accrued vacation.
2. If your employer attempts to delay payment or disputes what is due and owing, ask for a specification of the amount of wages disputed and not disputed. Request immediate payment of any undisputed wages and remind them of the possibility of waiting time penalties.
3. If your employer makes a latter attempt to pay your wages, do not avoid or refuse payment as this may preclude you from collecting penalties.
4. Keep the envelope that your wages came in as proof of date you received your final check.
5. Finally, be aware of the statute of limitations. Immediately contact an experienced California labor attorney to discuss your rights and legal remedies.
 

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A former sales representative claims he is owed $30,000 in commissions. His California labor law attorney has filed suit in San Francisco alleging this computer manufacturing giant denied three former salespeople thousands of dollars in commissions. The plaintiffs are seeking to represent all salespeople employed by the company who have not received their commission payment or bonuses. According to Bloomberg this could be at least 50,000 current and former employees. The company claims this loss may have been caused due to a malfunction in their order-management system and that around 2,000 out of 23,000 personnel from its global sales team were affected by the glitch

Oftentimes, sales people rely heavily on their commission and are generally classified as exempt employees or not entitled to overtime pay. However, it’s important to understand that in order to be classified as exempt, among other things; you must be actively selling at least 50% of the time. Whether you are an Inside Salesperson or Outside Salesperson, California laws strictly regulate salesperson commissions.

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