Overtime Exemptions 2017-12-13T21:46:22+00:00

Overtime Exemptions

In California, workers are generally owed “premium pay” (or 1.5 times their regular hourly rate) for all hours worked over eight in a single day, or 40 hours in a week. This means that if you worked 8.5 hours today (not counting lunch), and are paid $10 an hour, your paycheck should show $85 for today. Additionally, employees are owed double time for work beyond 12 hours in a work day.  There are two major types of common misclassification.

Salaried vs. Hourly – Sometimes employers will call someone a “manager”, pay them a salary, and not provide meal or rest periods, or overtime pay.  But if the employee spends most of his or her time doing non-managerial work, the employee could be misclassified as exempt from overtime.
If that “manager” spends most of their time ringing up customers, stocking and cleaning the store, they may be misclassified, entitling them to overtime pay and penalties for missed meal and/or rest periods they didn’t receive due to wrongful classification.  However, if that employee spends most of their time supervising other employees, hiring and firing, and making policy decisions about how the store is run, their classification may be proper.

However, there is a list of exemptions from overtime pay.

  • EXECUTIVE EXEMPTION:
    • This applies to those who spend most of their time managing the business, regularly exercising discretion and independent judgment, and who regularly supervise two or more employees, and/or the authority to hire/fire and promote. They must make no less than two times the state minimum wage for full time work to be exempt from overtime requirements.
  • ADMINISTRATIVE EXEMPTION:
    • This applies to employees who primarily perform non-manual work related to the general business operation, such as secretaries and office managers. To qualify for the exemption, the employee must regularly exercise discretion and independent judgment, and have obtained special training, experience or knowledge in the field in question. They must make no less than two times the state minimum wage for full time work to be exempt from overtime requirements.
  • PROFESSIONAL EXEMPTION:
    • Workers who are licensed by the state, and who work primarily in the practice of law, medicine, dentistry, optometry, architecture, engineering, teaching or accounting are covered by this exemption.  These employees typically have advanced knowledge acquired by a specialized course of study or apprenticeship.   They must make no less than two times the state minimum wage for full time week to be exempt from overtime requirements.
  • COMPUTER SOFTWARE EXEMPTION:
    • California employees qualify for this exemption if they primarily apply systems analysis or designs, develop, document, analyze, create, test or modify computer systems or programs.  To qualify for the exemption, the worker must earn at least $41 per hour, or as of 1/1/13.  (But guaranteed incentive pay paid less than once a month cannot be used in reaching the minimum, which changes yearly based on cost of living.)
  • OUTSIDE SALES EXEMPTION:
    • These employees are not required to be paid overtime.  But they most be both 1) primarily engaged in selling, (meaning that is how they spend most of their time) and  2) they must be spending more than 50 percent of their work time away from the employer’s place of business.
  • COMMISSIONED SALESPERSON EXEMPTION:
    • This applies to employees who are both 1) primarily engaged in sales and 2) has earnings over 1.5 times the California minimum wage and 3) make more than half their income from commissions and 4) is covered by DLSE Wage Order 4 (professional/technical/clerical/mechanical) or Wage Order 7 (mercantile/store operations).
  • AGRICULTURAL/HOUSEHOLD WORKERS:
    • Workers covered by Wage Orders 14 and 15, those in the agricultural industry or household occupations (companions, day workers, gardeners, housekeepers, nurses and similar) can adopt an alternative workweek schedule.  If an election takes place, workers can vote that overtime not be required on days of 10 hours or shorter per weekday and within a 40 hour week.
      But employees must be paid premium pay for hours beyond the agreed-upon schedule up to 12 hours per day or beyond 40 hours per week.  Employees must be paid double their regular rate for work over 12 hours in any day, and over eight on those days worked beyond the regularly scheduled number of workdays in the agreement.
  • ON-SITE MINING, DRILLING AND LOGGING EMPLOYEES:
    • an employee who works longer than eight but no more than 10 hours in a day on an alternative work schedule must be paid at the overtime rate over the hours established in the agreement.
  • PROFESSIONAL, TECHNICAL AND MECHANICAL EMPLOYEES/PUBLIC HOUSEKEEPING EMPLOYEES:
    • The technical/mechanical category includes accountants, agents, appraisers, canvassers, clerks, copy writers, guards, mechanics, machine operators, photographers, ticket agents, teachers and technicians.  The Public Housekeeping category covers employees who work in restaurants or bars, catering operations, hotels, hospitals, and private schools.  This exception provides for workdays over 10 hours but less than 12 in a 40 hour workweek the following are true:
    • They are employees in the healthcare industry who are subject to a validly adopted alternative workweek schedule.
    • No overtime required for a regular schedule of not more than 10 hours per day in a 40-hour week.
    • They are paid double their regular rate for work over 12 hours in any day and any more than 8 hours per day beyond the regular schedule established in the agreement.
    • For all employees except those in the construction/drilling/mining/logging category, if the employer requires fewer hours than regularly scheduled, the employee must pay overtime rates for time worked in excess of 8 hours per day and double for hours over 12.
    • Public housekeeping employees who work in a hospital (or establishment primarily engaged in care of the sick, aged or mentally ill who reside there) who have a 14 consecutive day work period, must be paid 1.5 times their regular rate for time over eight hours in a day or 80 in two weeks, pursuant to an agreement or understanding with the employer. No double time is required.
    • CAMP COUNSELORS:  no daily or weekly overtime is required as long as the employee doesn’t work more than six days in a week.  In an emergency, a camp counselor can work more than 40 hours or six days in a week, but must be paid 1.5 times their regular rate for those hours.  No double time required.
    • PERSONAL ATTENDANTS:  (meaning baby sitters or non-profit  employees whose primary job is to feed and dress a person who, due to age or disability, needs help.  These employees are not entitled to daily overtime, and none weekly provided they don’t work more than 40 hours per week, nor more than six days per week.  In an emergency, they may workover 40 hours or six days, but they must be paid 1.5 times their regular rate for all excess hours.  No double time required.
    • RESIDENT MANAGERS OF HOMES FOR THE AGED WITH LESS THAN EIGHT BEDS:  No daily overtime.  No weekly overtime required provided the employee works no more than 40 hours per week, or six days per week.  In an emergency, the employee may more over 40 or six but must be paid 1.5 times their regular rate for all excess hours.  No double time required.
    • EMPLOYEES DIRECTLY RESPONSIBLE FOR THE CARE OF CHILDREN UNDER 18 AT A 24-HOUR RESIDENTIAL FACILITY:  No daily or weekly overtime required as long as the employee works no more than 40 per week  or six days per week.  All time worked over 40 hours and over six days in a week must be paid 1.5 times their regular rate.
    • AMBULANCE DRIVERS AND ATTENDANTS:  No overtime required for those scheduled for 24-hour shifts who have agreed in writing to exclude from daily time worked no more than three one-hour meals and regularly scheduled, uninterrupted sleeping period of up to eight hours.
    • SKI ESTABLISHMENT EMPLOYEES:  During any month when Alpine or Nordic skiing activities are happening, employees may have a regular schedule of not more than 48 hours per week, and they shall be paid 1.5 times their regular rate for over 10 hours per day or 48 hours in a week.
    • MOTION PICTURE INDUSTRY WORKERS WHO ARE ‘EXTRA PLAYERS’ meaning (extras, stand-ins, photo doubles and sports players) Must be paid 1.5 times their regular rate for the 9th and 10th hours in a work day, and double for hours over 10.
    • MINORS:  Except those who are 16 and 17 years old who are not required by law to attend school, must be paid 1.5 times their regular rate for all hours on the sixth consecutive work day.
    • AGRICULTURAL WORKERS NOT OTHERWISE EXEMPTED FROM OVERTIME:  Must be paid 1.5 times their regular rate for all hours over 10 in a workday and for the first eight hours worked on the seventh consecutive work day in a work week, and double time for all hours worked over eight on the seventh consecutive day in a row.  (However, no overtime pay is required on the seventh day if the total hours worked in the week don’t exceed 30 and the total hours in any work day don’t exceed six.)
    • LIVE IN EMPLOYEES:  Those who work during the three scheduled off-duty hours that fall within a 12-hour workday, or during the 12 consecutive off-duty hours in a workday, must be paid 1.5 times their regular rate for all such hours worked. Also, those who work over five days in a week must be paid 1.5 time for hours worked up to and including nine hours on the 6th and 7th workday, and twice their regular rate for all hours over nine on the 6th and 7th days.
    • NON-LIVE-IN HOUSEHOLD WORKERS:  No overtime required on the 7th consecutive day of work when the total hours of work that week don’t exceed 30 and the total hours worked in any one day don’t exceed six.

The subject of overtime pay is one of the most confusing subjects because of the many exemtpions. If you feel there is a chance that you have not been paid fairly, then please contact our office so we can evaluate your case, or you can return to the overtime page.

IWC Opinion Letters: Overtime Exemptions

See the links below for opinions by the Chief Counsel of the Labor Commission regarding overtime exemptions: