Understanding Overtime Pay: Your Rights and Employer Obligations

Overtime Pay Rules in California

Under the law, a California employer must offer nonexempt employees overtime compensation of 1.5 times their normal wage for every hour worked past eight hours over a normal workday or forty hours across a standard work week. These rules apply for any nonexempt employee who works overtime hours, regardless of whether or not the employer must approve those hours ahead of time.

If you worked beyond eight hours in a typical workday, you are entitled to receive overtime compensation for your time at 1.5 times your current wage. In situations where you worked past 12 hours in a typical workday, you are entitled to receive overtime compensation at twice your current wage.

Therefore, let’s say you’ve worked 11 hours on a workday. You are entitled to receive three hours of compensation of 1.5 times your normal wage. If you are expected to put in a 40 hour work week and you work more than 40 hours over that week, you are entitled compensation of 1.5 times your normal wage for every hour past that expected 40 hours. However, if your employer asked you to work across seven consecutive days in a row, you are entitled to receive compensation at two times your normal wage for every hour you worked beyond eight hours on that day.

Hourly Wage vs Salary

While California employers are bound by law to compensate nonexempt employees for overtime hours worked, some employees are not entitled to overtime pay. Nonexempt employees are either paid an hourly wage or a salary. But some workers who receive the latter may not be entitled under the law to receive compensation for overtime work. This includes workers who hold executive positions in an organization, administrative or professional employees.

Nonexempt employees who are paid an hourly wage calculate their overtime pay by taking the normal wage earned and adding the hours worked beyond the standard business hours, typically eight hours in a normal workday.

Nonexempt employees who are paid a salary and entitled to receive overtime pay calculate their additional compensation by multiplying their salaried earnings by 12 and dividing that number by 52. The total sum is then divided by 40, representing the number of hours in a normal work week.

Penalties for California Overtime Pay Violations

The California Labor Code is explicit with respect to the definitions of overtime pay and how it should be earned by employees. Non-compliance with the law comes with significant penalties for employers who fail to compensate their workforce for overtime hours worked or fail to issue overtime and normal wage payments in a timely manner.

Employers who violate the law may be subject to damages in the form of fines and other penalties that can add up quickly. If an employer fails to compensate an employee for overtime hours worked by the next payday, that employer could be subject to interest accrued on the unpaid amount. There may be additional penalties of up to $1,000 per violation as well as any fees that an employee incurs should he or she be forced to file a claim with the California Division of Labor Standards Enforcement (DLSE) to get the compensation to which they are entitled. If the employee has to pursue legal action against his or her employer, the costs and fees associated with that filing may also fall on the employer. Compensatory damages may also be awarded to an employee on top of the amount due for overtime hours worked and interest accrued on that amount.