BUSINESS LAW: Employment
Law - Overtime Wages
The Law Offices of David D. Murray has handled employment
related cases since 1983, representing California clients in negotiation
and litigation concerning matters such as:
- Wrongful Discharge from employment
- Sexual Harassment and Hostile
- Negotiation of Termination Agreements
- Violation of immigration law - Form
- Unemployment claims
- Wage/Hour claims
- Overtime Wage claims
In the arena of
employment-related contracts and agreements, the Law Offices of
D. Murray have successfully negotiated and drafted:
- Employment Agreements
- Independent Contractor Agreements
- Separation Agreements
- Settlement Agreements
- Company Handbooks
- Company Policy Manuals
EMPLOYERS LIABILITY FOR
FAILURE TO PAY MINIMUM WAGE . . . .
. (California Law - other states may be different)
It is unlawful to "secretly pay" a wage less
than the minimum wage (as established by statue) while purporting to
pay the minimum wage (California Labor Code § 223).
California minimum wage is $8.00per hour. Employers who fail to pay the statutory
minimum, or who fail to pay overtime rates established by law, may
be sued by aggrieved employees in either state or federal court
(29 USC § 216(b)). The employee may collect all unpaid wages, as
well as an additional equal amounts as liquidated damages and other
penalties, plus costs, and a reasonable attorney fee (29 USA § 216(b)).
A law suit may also be brought on behalf of
others "similarly situated", so if an emplohyer has other employees
who have been treated in
a same or similar manner, the employer's liability may be further
Further, pursuant to California Labor Code section 1194(2), employees
seeking to recover unpaid minimum wage compensation are also entitled
to recover "liquidated damages" in an amount equal to the wages
unlawfully unpaid and interest thereon. Pursuant to California Labor
Code section 1197.1, in addition to any other penalty, an employer who
fails to pay minimum wage is subject to a civil monetary penalty
for each underpaid employee for each pay period for which the employee
is underpaid for each initial failure to pay, and thereafter, the
penalties are assessed for each underpaid employee, for each pay
period. Other penalties and the potential for the award of attorneys
fees, punitive damages and injunction, make compliance with overtime
laws critical to the wise employer.
Employers should be aware of their rights, and should report any
violation of law to the California Labor Commissioner. Further advice
on this subject can be obtained from qualified legal counsel.
EMPLOYEES AND EMPLOYERS WORK TIME OR
HOURS WORKED . . .
(California Law - other states may
To the extent that federal and state
requirements conflict, employers must follow the law that provides
the most protection for the employee. [Aguilar v. Association for
Retarded Citizens, 234 Cal.App.3d 21, 34-35, 285 Cal.Rptr. 515
see also 29 U.S.C. § 218(a)]
In the State of California the "hours
worked" by an employee is significant in the determination of
whether the employer has complied with both its minimum wage and its
overtime compensation obligations. The wage orders broadly
define"hours worked" as the time during which an employee is subject
to the control of the employer,a nd includes all the time the
employee is "suffered or permitted to work, whether or not required
to do so"
[8 Cal. Code Reg., sections
11010-1130, 11-60-1110, 1113 &. 11140, para. 2(G)
Because "hours worked" under the wage orders
include time when the employee is "permitted to work, whether or
not required to do
so," the Division of Labor Standard Enforcement ("DLSE") has historically
taken the position that an employee who works overtime even though
not requested to do so must be paid overtime compensation as required
by the wage orders if the employer or supervisor knew or had reason
to believe that the employee was working and did not prevent the
The DLSE has also taken the position that
the mere promulgation of a rule against overtime work is not enough
to avoid liability for overtime pay. Under Federal law, governed by
the Fair Labor Standards Act (FLSA), the number of hours that the
employer has "employed" an employee refers to hours the employee was
made "to suffer or permitted to work."
[29 U.S.C. § 203(g)].
Work not requested by suffered or permitted must b counted as work
time, including work performed at home that the employer knows or
has reason to believe is being performed. [29 C.F.R. Â§ 785.112].
An employee's failure to report overtime
work will not defeat a claim for overtime if the employer knew that
the employer knew that the employee worked the unreported overtime.
[Forrester v. Roth's I.G.A. Foodliner, Inc.
(9th Cir. 1981) 646 F.2nd 413, 414]
The mere promulgation of a rule against
overtime work is not enough. Management has the power to enforce
rule and must make every effort to do
[29 C.F.R. § 785.13].
Standby, Waiting or On-Call Time:
Under the law of the State of California, an
employee who is required to remain at the place of business and
respond to emergency calls must be paid for that waiting time. The
DLSE's operation and procedures manual states that on-call or
standby time is not compensable when the employee is not required to
remain on the employer's premises and is free to engage in personal
pursuits, subject only to the requirement that the employee can be
reached if needed. Such on-call or standby time is not considered
Policies and Interpretation Manual, section 46.2].
The central inquiry is whether the time in
question is best characterized as "controlled" or "uncontrolled."
For example, an employee who is required to stay at home and keep
the telephone line free from calls from the employer who is required
to stay at home and keep the telephone line free for calls from the
employer is not free to engage in personal pursuits. Such on-call
time would be considered hours worked. [Wilcox, California
Employment Law (Matthew Bender 1996) 3.07(1)(3), p 3-60]. However,
pager systems, cell phones separate from the employee's personal
telephone, or other arrangements for periodic call-ins that allow
normal movement in the community are alternatives that may allow the
employee to engage in personal pursuits.
[DLSE Enforcement Policies and Interpretation Manual, sections 46.2
Under Federal law, time within which an employee is on-call but
free to pursue his/her own interests effectively relieved from duty
and away from the employer's premisses does not constitute work
time. Under the FLSA, the courts examine two factors in determining
whether on-call time must be considered "hours worked":
(1) the degree to which
the employee is free to engage in personal activities;
(2) any agreements between
[Owens v. Local No. 169 (9th Cir. 1992) 971 F. 2d 347, 350].
An employee who is required to remain
on-call on the employer's premises or so close that the employee
cannot use the time effectively is deemed to be working while
[29 C.F.R;. 785.17; Brock
v. DeWitt (W.D. Mo. 1986) 633 F.Supp. 892, 895-896 (where restaurant
employees were directed to report, but not permitted to clock in
until there was sufficient work were found to be entitled to compensation
for on-call time)].
An employee who is not required to remain on
the employer's premises but merely required to leave word at his or
her home or with company officials where he or she may be reached is
not generally regarded as working while on-call. [29 C.F.R.
78517; Leonard v. Carmichael Property and Management Co., Inc. (S.D.
Fla. 1985) 614 F.Supp.
Travel and Sleeping Time:
Under the laws of the state of California, arrival a the designated
or prescribed reporting place starts the day's work, unless travel
time to the place is beyond the time required for the normal or
usual commute between home and work. Thus, time spend traveling
between and the usual work place is not counted as hours worked.
The fact that the employee commutes in a
vehicle owned, leased, or subsidized by the employer and used for
the purpose of ride sharing, as defined in Vehicle Code section 522,
does not alter this rule. [Labor Code section 510].
This rule shall not be construed to affect,
change, or limit an employer's liability under the workers' compensation
law. [Labor Code § 510].
Under DLSE policy, if an employee is required to be on duty for
less than 24 hours, the employee is considered to be working for
the entire period, even though the employee is permitted to sleep
or engage in other activities when not busy. On the other hand,
if the employee's on-duty period extends for 24 hours or more, both
sleep time and uninterrupted meal periods of at least 30 minutes
many be excluded from working time. The sleep time exclusion may
not exceed eight hours during each 24 hours of duty, and the employer
must furnish adequate sleeping facilities. [DLSE. Enforcement Policies
and Interpretation Manual, section 43.2; Aguilar v. Association
for Retarded Citizens (1991) 234 Cal.App. 3d 21, 30, 285 Cal.Rptr.
If an employee resides on the premises of a
location covered by Wage Order 5-98 for the Public Housekeeping
Industry, only the time actually spent working will be considered
compensable time. [DLSE Enforcement Policies
and Interpretation Manual, section 45.3 - 45.3.1].
Special rules apply to ambulance drivers; an
employer and employee working as an ambulance driver working a
24-hour shift may enter into an agreement to exclude up to three
one-hour, duty-free meal periods and up to 8 hours
of uninterrupted sleep from "hours worked"
provided adequate sleeping facilities are provided by the employer.
[Merzon v. Schaefer Ambulance Service (1990) 224 Cal.App.3d 16].
Under Federal law the Portal-to-Portal Act [29 U.S.C. §§ 251-262,
no employer will be liable for the failure to pay the minimum wage
or overtime compensation for time spent in walking, riding, or traveling
to and from the actual place of performance of the employer's principal
activity or activities. Thus, certain travel time at the commencement
or cessation of the workday need not be counted as working time
unless it is compensable by contract, custom, or practice. [29 U.S.C.
If an employee regularly works at a fixed
location in one city, and is given a special one-day work assignment
in another city, the travel time involved is considered work time.
[29 C.F.R.§ 785.37].
An employee who is required to be on duty
for less than 24 hours is considered to be working even when he or
she is permitted to sleep or engage in
other personal activities when not busy.
C.F.R. § 785.21].
If the employee is required to be on duty
for 24 hours or more, the employer and the employee may agree to
exclude bona fide meal periods and a bona fide regularly scheduled
sleeping period of no more than eight hours, provided
adequate sleeping facilities are furnished and the employee can
usually enjoy an uninterrupted night's sleep.
[29 C.F. R. §
In the absence of an agreement, the eight hours
of sleeping time and meal periods constitute hours worked.
[29 C.F.R.§ 785.22(a)].
Both Employers and Employees should be aware of their rights, and
should report any violation of law to the California Labor Commissioner.
Further advice on this subject can be obtained from qualified legal
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