Overtime pay is a critical aspect of ensuring fair compensation for employees who work overtime hours. However, California law recognizes certain exemptions that relieve employers from the obligation to pay overtime to specific categories of workers. In this blog post, we’ll explore the various exemptions from overtime pay under California law, shedding light on the criteria that determine whether an employee falls within these exemptions.
Executive Exemption
The executive exemption generally applies to employees in managerial or supervisory roles. The exemption applies where the employer can show: (1) that the employee customarily and regularly directs the work of at least two or more other employees; (2) that the employee has the authority to hire and fire, or to command particularly serious attention to his or her recommendations regarding such actions; and (3) that the employee is “primarily” engaged in more than 50% of worktime “duties that meet the test of the exemption.”
Administrative Exemption
Employees engaged in administrative, office, or non-manual work may be exempt from overtime if their primary duties involve office or non-manual work directly related to the management or general business operations of the employer, and they exercise discretion and independent judgment. “Administrative employees” are those whose primary duties are directly related to management policies or general business operations of the employer or its customers, as distinguished from “production employees” whose primary duty is producing the goods or services that the employer produces.
Professional Exemption
The professional exemption applies to employees in learned or creative professions. To be exempt from overtime pay and minimum wage requirements under the exemption for “professional” employees, the employee must be either licensed and “primarily engaged” in an enumerated profession, or “primarily engaged in an occupation commonly recognized as a learned or artistic profession.”
Computer Professional Exemption
Certain employees in the computer software field may be exempt from overtime if they meet specific criteria related to their job duties and compensation. This exemption typically applies to those who engage in computer system analysis, programming, or software engineering.
Outside Salesperson Exemption
Employees engaged in outside sales may be exempt from overtime. An “outside salesperson” is someone who regularly works more than half of his or her working time in sales activities outside the workplace.
Commissioned Sales Exemption
Employees engaged in commissioned sales of certain retail goods and services may be exempt from overtime if more than half of their compensation comes from commissions, and their regular rate of pay exceeds one and a half times the minimum wage.
Certain Healthcare Workers
California labor laws provide exemptions for certain healthcare workers, such as registered nurses and licensed practical nurses, who meet specific criteria related to their education, licensing, and scope of practice.
Certain Motor Carrier Employees
Motor carrier employees, including drivers, mechanics, and loaders, may be exempt from overtime if they are covered by the Motor Carrier Act and are engaged in interstate commerce.
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Understanding the exemptions from overtime pay under California law is crucial for both employers and employees. Whether or not a particular exemption applies in a particular situation must be taken into account. This is not a one size fits all determination.
If you are involved in a dispute involving this area of employment law, our experienced employment lawyers stand ready to help. We help employers understand their obligations, and employees understand their rights. Visit our website to ensure your rights are protected. Akopyan Law Firm, A.P.C. provides a complimentary consultation and is proud of our many positive testimonials.