There are two categories of employees in CA:
- Exempt or Salaried , and
- Non-exempt or (hourly)
An employee is presumed to be non-exempt and thus entitled to overtime, rest periods, meal periods and itemized wage statements. The employer bears the burden of proving that an employee is exempt and, thus, not entitled to overtime, rest periods, meal periods and itemized wage statements.
Under California law, exempt employees are not subject to the rules governing meal break, rest break, overtime and off-the-clock work. However, employees are often wrongfully misclassified as an “exempt employee.” If you have been erroneously misclassified as exempt, then your employer has a duty to pay for all your meal and rest breaks, overtime, and off-the-clock work.
In order to satisfy the exemption test, CA labor law provides three possible exemptions:
Executive Exemption requires that the employee:
(i) regularly supervise two or more persons,
(ii) have the authority to hire or fire other employees; or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight,
(iii) customarily and regularly exercise discretion and independent judgment; and
(iv) spend more than 50% of their time performing non-exempt tasks.
Merely giving an employee the title of "Manager" or "Supervisor" does not convert a non-exempt employee into an exempt employee. The actual job duties must be analyzed to determine if an employee is exempt or non-exempt.
The Administrative Exemption applies only to those employees:
(1) who perform office or non-manual work directly related to management policies or general business operations;
(2) who customarily and regularly exercise discretion and independent judgment;
(3) who assist a proprietor or executive or administrator;
(4) who perform only under general supervision; and
(5) spend more than 50% of their time performing non-exempt tasks. Cal. Code Regs., tit. 8, §11040(1)(A)(2).
The one element that all exemptions have in common is that the exempt employee must earn a monthly salary that is no less than two times the state minimum wage. Lab. C. §515(a).
In 2021, if your employer employs less than 25 persons, any employee classified as exempt must earn $4,506.67 per month ($54,080 per year) or they are not exempt. Beginning January 2022, that amount increases to $4,853.33 per month ($58,240 per year), once the minimum wage for businesses employing under 25 persons increases to $14.00/hour.
If your employer employs more than 25 persons, the $4,853.33 monthly rate applies now (based on a minimum wage rate of $14.00/hour), and will increase to $5,200 per month ($62,400 per year) starting January 1, 2022.
If you are an exempt employee, and do not fall under any of the categories above, and/or your salary is less than $58,240, then please reach out to our experienced employment lawyers. Our law office has successfully represented many employees who were erroneously misclassified.
Example: Mary is a restaurant manager and oversees a large kitchen staff. Despite her numerous work duties, she is only paid $4,000/month. This equals to a salary of $48,000.00 a year. Mary is misclassified and therefore has a claim against her employer for her missing overtime, off-the-clock, and meal break and rest break premiums.