Overtime Exemptions

Overtime Exemptions Under California Law

Because the overtime pay laws arise out of the acknowledgement by the state legislature that the nature of the workplace puts employees in a weaker bargaining position than their employers, overtime exemptions from those pay laws are narrowly tailored in favor of employees. In the same vein, the burden of proof in cases brought by employees seeking unpaid overtime lies with the employer.

Am I Exempt from Receiving Overtime Pay?

Under California wage and hour laws certain workers are exempt (not eligible) from receiving overtime pay. Determining if a certain worker is exempt can be tricky, but the exemptions include:

  • Salaried executive, administrative, and professional employees;
  • Outside Salespersons;
  • Specified Commissioned Inside Salespersons;
  • High Level Computer Professionals.

Workers that fall within any of the above categories are completely exempt from overtime pay requirements. If you do not fall within one of these categories, then it is presumed that you qualify for overtime pay, however other restrictions may apply.

Executive, Administrative, and Professional Exemptions (“White Collar” Exemptions)

Under Labor Code section 510, and section 511 exemptions have been established that exclude certain classifications of professions from overtime compensation. Under the statute, to be exempt:

  • You must be paid at a specific level;
  • The nature of the work you perform must be executive, administrative, or professional.
  • Your primary duties must involve the same kind of exempt work; and
  • You must discharge those primary duties by regularly exercising independent judgment and
    discretion.

It is the duties and salary that determine if you are exempt, not the fancy job titles that your employer may give you.

More Specifically:

Salary:You must earn a monthly salary that equates to at least twice the minimum wage for full time employment. As of January 1, 2016 that translate to a monthly salary of $3,466.00, or $800 per week, or an annual salary of $41,600.00; and

Duties:

Executive Exemption: In order for this exemption to apply:

  • Your duties and responsibilities must involve the management of the enterprise in which you are employed or a customarily recognized department or subdivision of the enterprise;
  • You must regularly direct the work of two or more employees in your department;
  • You must have the authority to directly or indirectly hire or fire other employees;
  • You regularly exercise discretion and independent judgment; and
  • You spend more than ½ of your time doing the above.

Administrative Exemption: In order for the exemption to apply:

    • Your duties and responsibilities must involve either: (1) performance of office or non-manual work directly related to management policies or general business operations of your employer or your employer’s customers, OR (2) performance of administration of a school system,
      educational establishment;
    • You regularly exercise discretion and independent judgment;
    • You
  • Regularly and directly assist your superior or an employee employed in a bona fide
    executive or administrative capacity;
  • Perform specialized or technical work requiring special training, experience, or knowledge, under only general supervision, or
  • Execute special assignments and tasks under only general supervision; and
  • You spend more than ½ of your time doing the above.

Professional Exemption: In order for the exemption to apply:

  • You must be licensed or certified by the State of California and be primarily
    engaged in the practice of: law, medicine, dentistry, optometry, architecture, engineering, teaching, or accounting; or
  • You are primarily engaged in an occupation commonly recognized as a learned or artistic
    profession; and
  • You regularly exercise discretion and independent judgment in the performance of your duties.

Click here to read an in-depth article on the top overtime rights that you need to know.