This week’s Friday’s Five covers five misconceptions about California employment law that can land employers in a lot of hot water:
- Meal and rest breaks seem so trivial.
The topic for the uneducated (or out of state) employer does seem trivial. However, with the penalty owed to employees of one hour of pay for each missed meal or rest break (i.e., up to two hours of penalty pay per day) these violations add up to significant amounts of liability very quickly. Wal-Mart’s 2005 verdict in California for meal and rest break violations for $172 million is a good example.
- My payroll company understands the laws about wages and itemized pay statements.
Payroll companies are not law firms and they will not notify you if you are not paying your employees properly, calculating overtime correctly, or even ensure that the paystubs they generate for your employees comply with the law. It is the employer’s responsibility to ensure the employment laws are being complied with, and it is wise to have an experienced employment lawyer review these practices and audit the practices of the payroll company.
- The employee’s title determines if they are owed overtime.
An employee’s title is not determinative of whether they qualify as an exempt employee. See my previous article on the various exemptions that employees may qualify for, and the requirements necessary for employees to meet those exemptions.
- Employees can be provided “comp time” instead of paid overtime.
While it is true employers may provide employee’s comp time in lieu of overtime, there are many technical restrictions that must be met in order for comp time plans to be legal under California law. Labor Code section 204.3 only authorizes employers to provide nonexempt employees with compensated time off instead of pay for overtime if the following requirements are met:
- Payment for comp time must be at the overtime rate of pay (i.e., not less than one and one-half hours for each hour of employment, or double time if applicable)
- Must be in writing before work begins
- Employees cannot accrue more than 240 hours of compensation time off
- Employee has to make a written request for comp time in lieu of overtime
- Employee must be scheduled to work at least 40 hours a week
- Employee must be paid at rate of pay in effect at time of payment
- Payment at termination must be at high of current or three-year average rate of pay
- Employee must be permitted to use comp time within reasonable period
- Employer must keep records of comp time accrued and used
- My company is too small to be a target for employment litigation.
If you have been a reader of this blog for any time period, you understand that every employer in California needs to understand their legal duties when it comes to employing workers. And with competent employment law counsel [:)] it is not hard to comply with the law, but it is difficult to keep current with the law and ensure all legal obligations are being met.