Overtime pay is an important form of compensation for many workers in California. Those who are employed on an hourly basis are typically earning wages near the minimum wage, so earning time-and-a-half for additional hours can make a significant difference in their paychecks.
Conventional wisdom among many has it that people stop earning overtime once they begin earning a salary. While not necessarily untrue, this misconception simplifies how overtime eligibility is determined in California. Under certain conditions, being paid a predetermined annual amount doesn’t mean the employee isn’t entitled to overtime pay.
The Minimum Salary Requirement in California
Earning a salary doesn’t automatically mean relinquishing your right to earn overtime wages. Unless your annual pay meets or exceeds the state’s minimum salary requirement, you are still entitled to earn overtime pay.
In California, the minimum salary requirement is based on the state’s minimum wage. Specifically, salaried employees must be earning at least double the state’s minimum wage per hour to become ineligible for overtime compensation.
As of 2021, California’s minimum wage is $14 for most employers and is set to rise to $15 for all employers by 2023. This means that the current minimum salary requirement is $58,240 for most employers during 2021 and will become $62,400 for all employers when the new minimum wage law is fully implemented in 2023.
Exempt vs. Non-Exempt Employees
There are, of course, salaried employees who aren’t eligible to earn overtime. These employees are exempt from earning overtime because they meet a few important requirements.
These requirements are as follows:
- Paid at least the minimum salary
- Spends at least half of their time performing administrative, executive, or professional tasks
- Uses independent judgment and discretion to perform job duties
A salaried employee who doesn’t meet these requirements and isn’t being paid overtime by their employer could be owed significant back pay for unpaid overtime compensation. They may also be able to seek additional damages if they were misclassified as an exempt employee, despite their eligibility to earn overtime.
Do You Need Legal Assistance?
If you believe you are owed overtime compensation, the best thing to do is seek guidance from an employment law attorney. Professional legal counsel can help you determine what exactly you’re owed as well as the legal options available to recover it.