California

Labor Compliance Guide

Hours & Pay Regulations

Normal Working Hours

Ordinarily, the hours to be used in computing the regular rate of pay may not exceed the legal maximum regular hours which, in most cases, is 8 hours per workday, 40 hours per workweek. This maximum may also be affected by the number of days one works in a workweek. It is important to determine what maximum is legal in each case. The alternate method of scheduling and computing overtime under most Industrial Welfare Commission Wage Orders, based on an alternative workweek schedule of four 10-hour days or three 12-hour days does not affect the regular rate of pay, which in this case also would be computed on the basis of 40 hours per workweek.

 

The agreed upon regular hours must be used if they are less than the legal maximum regular hours. However, in circumstances where the workweek is less than 40 hours, the law does not require payment of the overtime premium unless the employee works more than eight hours in a workday or more than 40 hours in a workweek. In other words, assuming you are employed under a policy that provides for a 35-hour workweek, the law does not require the employer to pay the overtime premium until after 40 hours in a workweek. If you work more than 35 but fewer than 40 hours in a workweek, you will be entitled to be paid for the extra hours at your regular rate of pay, as overtime premium pay is only required after 40 hours in a workweek.

 

The Second Appellate District of California held that the retail employees who had to “call-in” 2 hours before their scheduled shift to find out if they have to report to work were entitled to “reporting time pay”. The California Court of Appeal n February 4, 2019,  issued their majority and dissenting opinion in Ward v. Tilly’s, Inc. It appears to be a precedent-setting ruling in California, holding that an employee scheduled for an on-call shift may be entitled to certain wages for that shift despite never physically reporting to work. Each of California’s Industrial Welfare Commission (“IWC”) wage orders requires employers to pay employees “reporting time pay” for each workday

Overtime

Employees covered by California’s overtime law, work in excess of eight hours in a workday shall be compensated at the rate of one-and-one-half times the regular rate of pay. Work in excess of 12 hours in a workday shall be compensated at the rate of double the regular rate of pay. Any work in excess of 40 hours in any workweek shall be compensated at the rate of one-and-one-half times the regular rate of pay.

 

The first eight hours of work on the seventh consecutive day of work in any workweek shall be compensated at the rate of one-and-one-half times the regular rate of pay, regardless of the number of hours worked during the previous six days. Every hour worked after eight hours on the seventh consecutive workday in any workweek is paid at double the regular rate of pay.

 

Effective Jan. 1, 2014, domestic-work employees who are personal attendants also must be paid 1.5 times their regular rate of pay for all hours worked over nine hours in a single workday and for all hours worked more than 45 hours in the workweek.

Breaks

In California, the Industrial Welfare Commission Wage Orders require that employers must authorize and permit nonexempt employees to take a rest period that must, insofar as practicable, be taken in the middle of each work period. The rest period is based on the total hours worked daily and must be at the minimum rate of a net ten consecutive minutes for each four hour work period, or major fraction thereof. The Division of Labor Standards Enforcement (DLSE) considers anything more than two hours to be a “major fraction” of four.”

 

A rest period is not required for employees whose total daily work time is less than three and one-half hours. The rest period is counted as time worked and therefore, the employer must pay for such periods. With respect to the taking of rest periods, an exception exists under IWC Order 5-2001, § 12(C) for certain employees of 24-hour residential care facilities who may have their rest period limited under certain circumstances.

 

Another exception to the general rest period requirement is for swimmers, dancers, skaters, and other performers engaged in strenuous physical activities who shall have additional interim rest periods during periods of actual rehearsal or shooting. IWC Order 12-2001, § 12 (C). Pursuant to Labor Code Section 1030 every employer, including the state and any political subdivision, must provide a reasonable amount of break time to accommodate an employee desiring to express breast milk for the employee’s infant child. The break time shall, if possible, run concurrently with any break time already provided to the employee.

 

Break time for an employee that does not run concurrently with the rest time authorized for the employee by the applicable wage order of the Industrial Welfare Commission need not be paid. The employer shall make reasonable efforts to provide the employee with the use of a room or other location, other than a toilet stall, in close proximity to the employee’s work area, for the employee to express milk in private. The room or location may include the place where the employee normally works if it otherwise meets the requirements of this section. An employer is not required to provide an employee break time for purposes of lactating if to do so would seriously disrupt the operations of the employer. Thus, if an employer does not provide all of the rest periods required in a workday, the employee is entitled to one additional hour of pay for that workday, not one additional hour of pay for each rest period that was not provided during that workday.

Annual Leave

There is no legal requirement in California that an employer provides its employees with either paid or unpaid vacation time. However, if an employer does have an established policy, practice, or agreement to provide paid vacation, then certain restrictions are placed on the employer as to how it fulfills its obligation to provide vacation pay. Under California law, earned vacation time is considered wages, and vacation time is earned, or vests, as labor is performed.

 

An employer can place a reasonable cap on vacation benefits that prevents an employee from earning vacation over a certain amount of hours. And, unless otherwise stipulated by a collective bargaining agreement, upon termination of employment all earned and unused vacation must be paid to the employee at his or her final rate of pay. In California, because paid vacation is a form of wages, it is earned as labor is performed. An employer’s vacation plan may provide for the earning of vacation benefits on a day-by-day, by the week, by the pay period, or some other period basis.

Minimum Wage

Effective Jan. 1, 2018, the state’s hourly minimum wage has increased to $11 for employers with at least 26 employees and to $10.50 for employers with no more than 25 employees.

 

Effective Jan. 1, 2019, the state’s hourly minimum wage is to increase to $12 for employers with at least 26 employees and to $11 for employers with no more than 25 employees.

 

Effective Jan. 1, 2020, the state’s hourly minimum wage is to increase to $13 for employers with at least 26 employees and to $12 for employers with no more than 25 employees.

 

Effective Jan. 1, 2021, the state’s hourly minimum wage is to increase to $14 for employers with at least 26 employees and to $13 for employers with no more than 25 employees.

 

Effective Jan. 1, 2022, the state’s hourly minimum wage is to increase to $15 for employers with at least 26 employees and to $14 for employers with no more than 25 employees.

 

Effective Jan. 1, 2023, the state’s hourly minimum wage is to remain $15 for employers with at least 26 employees and is to rise to $15 for employers with no more than 25 employees.

 

Starting Aug. 1, 2022, the California director of finance to annually calculate the adjusted minimum wage to be implemented on Jan. 1 of the following year based on a specified formula. The calculation is to increase the minimum wage by the lesser of 3.5 percent and the rate of change between the averages of the most recent consumer price index from the July 1 to June 30 time period and that of the same period the preceding year. Decreases to the hourly minimum wage are not allowed.

 

Piece-rate workers also must receive at least minimum wage for each hour worked. The Industrial Wage Commission may issue special licenses authorizing employment at a wage less than the legal wage for employees who are mentally or physically disabled and for apprentices and learners.

Tips & Gratuities

California law does not allow tips and gratuities to be credited against the minimum wage. Although federal law allows payment of a cash wage of $2.13 to employees who regularly receive tips, California law requires payment of the full state hourly minimum wage, which is $10, effective Jan. 1, 2016.

Meal Breaks

An employer may not employ an employee for a work period of more than five hours per day without providing the employee with a meal period of not less than 30 minutes, except that if the total work period per day of the employee is no more than six hours, the meal period may be waived by mutual consent of both the employer and employee. An employer may not employ an employee for a work period of more than 10 hours per day without providing the employee with a second meal period of not less than 30 minutes, except that if the total hours worked is no more than 12 hours, the second meal period may be waived by mutual consent of the employer and the employee only if the first meal period was not waived.

 

Unless the employee is relieved of all duty during his or her thirty minute meal period, the meal period shall be considered an “on duty” meal period that is counted as hours worked which must be compensated at the employee’s regular rate of pay. An “on duty” meal period shall be permitted only when the nature of the work prevents an employee from being relieved of all duty and when by written agreement between the employer and employee an on-the-job paid meal period is agreed to. The written agreement must state that the employee may, in writing, revoke the agreement at any time. The test of whether the nature of the work prevents an employee from being relieved of all duty is an objective one.

 

An employer and employee may not agree to an on-duty meal period unless, based on objective criteria, any employee would be prevented from being relieved of all duty based on the necessary job duties. Some examples of jobs that fit this category are a sole worker in a coffee kiosk, a sole worker in an all-night convenience store, and a security guard stationed alone at a remote site. If the employer requires the employee to remain at the work site or facility during the meal period, the meal period must be paid. If an employer fails to provide an employee a meal period in accordance with an applicable IWC Order, the employer must pay one additional hour of pay at the employee’s regular rate of pay for each workday that the meal period is not provided. This additional hour is not counted as hours worked for purposes of overtime calculations.

Special Leave

Paid Sick Leave

Public and private employers are covered by California’s Healthy Workplaces, Healthy Families Act. Employees, including part-time, per diem and temporary employees, are eligible for paid sick leave if they work in California for the same employer for at least 30 days within a year after beginning employment. Employees accrue at least one hour of paid sick leave for every 30 hours worked. Employees who are exempt from overtime requirements accrue paid sick leave based on a 40-hour workweek. New employees can use accrued paid sick leave beginning on their 90th day of employment. Employees can determine how much paid sick leave they need to use, but employers can set reasonable minimum increments (up to two hours) for using this leave. Employers are not required to allow employees to accrue more than 48 hours or six days of total paid sick leave if their right to accrue and use this leave is not unlawfully limited.

Domestic Violence Leave

Public and private employers are covered by California’s Healthy Workplaces, Healthy Families Act, are required to provide employees with paid sick days for the following purposes:

  • Diagnosis, care, or treatment of an existing health condition of, or preventive care for, an employee or an employee’s family member.
  • For an employee who is a victim of domestic violence, sexual assault, or stalking.
California Military Spousal Leave

California law requires that employees who work an average of at least 20 hours per week may take up to ten days of unpaid leave while their spouse is on leave from military deployment. To be eligible for this leave, the employee’s spouse must be a member of the Armed Forces of the United States (including National Guard or Reserves) on leave from deployment during a period of military conflict in an area designated as a combat theater or combat zone. Under California law, “spouse” is defined to include a registered domestic partner.

Pregnancy Disability Leave

All employers must provide a leave of up to four months, as needed, for the period(s) of time an employee is actually disabled because of pregnancy, even if an employer has a policy or practice that provides less than four months of leave for other similarly situated, temporarily disabled employees. Pregnancy disability leave does not need to be taken in one continuous period of time.  Employees are eligible for up to four months of leave per pregnancy, not per year.

 

A ‘four-month leave’ means time off for the number of days or hours the employee would normally work within four calendar months (one-third of a year or 17 1/3 weeks). For a full-time employee who works 40 hours per week, ‘four months’ means 693 hours of leave entitlement, based on 40 hours per week times 17 1/3 weeks.

 

For employees who work more or less than 40 hours per week, or who work on variable work schedules, the number of working days that constitutes four months is calculated on a pro rata or proportional basis. If a holiday falls within a week taken as pregnancy disability leave, the week is nevertheless counted as a week of pregnancy disability leave. If, however, the employer’s business activity has temporarily ceased for some reason and employees generally are not expected to report for work for one or more weeks, (e.g., a school closing for two weeks for the Christmas/New Year holiday or summer vacation or an employer closing the plant for retooling), the days the employer’s activities have ceased do not count against the employee’s pregnancy disability leave entitlement.

 

In contrast, a part-time employee who normally works 20 hours per week, would be entitled to 346.5 hours of leave. If that employee takes intermittent leave of 180 hours throughout her pregnancy, she would be entitled to only 166.5 more hours of leave, approximately two months of leave, leading up to and after her childbirth.

New Parent Leave

California employers with 20-49 employees within a 75-mile radius to provide up to 12 weeks of job-protected unpaid leave to new parents for the purpose of bonding with a newborn child. The employee must have worked at least 1,250 hours of service during the 12-month period in order to take up to 12 weeks of paid family leave. The purpose of the leave is to allow an employee time to bond with a new child within one year of the child’s birth, adoption or foster care placement.

Medical Leave

Employees are entitled to 12 weeks of unpaid, job-protected leave per year. This applies when you care for parent, spouse, or child who is seriously ill or own illness.

Bereavement Leave

Permanent employees receive up to 3 full workdays (24 hours in total) of bereavement leave (per occurrence) upon the death of a person related by blood, marriage, or adoption, or of any person residing in the employee’s immediate household at the time of death. If the death occurred outside the State, a request for two additional days of bereavement leave shall be granted.

Unpaid Leave
Employees may be eligible to take unpaid, job-protected, leave under the Family Medical Leave Act (“FMLA”). Please refer to the main United States page for further details on this Federal law.
Civil Air Patrol Leave
California employers with more than 15 employees must provide employees with up to 10 days of leave per year for Civil Air Patrol duty.
Volunteer Civil Service Leave
All employers must provide leaves of absence for employees who are required to perform an emergency duty. You are not required to compensate the employee during this time off. An employee who is denied volunteer civil service leave is entitled to reinstatement and reimbursement for lost wages and work benefits. Refusing to provide the leave as required by law is a misdemeanor. The amount of time an employee can use for volunteer civil service leave is unlimited.
Victim of Crime Leave
Any employee who is a victim of the specified felonies crime, or who is an immediate family member, registered domestic partner or the child of a registered domestic partner who is a victim of these felonies, will be eligible for leave when the employee notifies the company, as soon as practicable, of the need for leave under this policy. Employees may use accrued, unused paid time off (including [vacation/paid time off]) for leave taken under this policy. The notice and eligibility requirements for any such paid time off (PTO) will generally apply to an employee’s request for use of PTO under this policy.
Literacy Education Leave
Every private employer regularly employing 25 or more employees shall reasonably accommodate and assist any employee who reveals a problem of illiteracy and requests employer assistance in enrolling in an adult literacy education program, provided that this reasonable accommodation does not impose an undue hardship on the employer.
School Visitation Leave

An employer who employs 25 or more employees working at the same location shall not discharge or in any way discriminate against an employee who is a parent of one or more children of the age to attend kindergarten or grades 1 to 12, inclusive, or a licensed child care provider, for taking off up to 40 hours each year, for the purpose of either of the following child-related activities:

      • To find, enroll, or re-enroll his or her child in a school or with a licensed child care provider, or to participate in activities of the school or licensed child care provider of his or her child, if the employee, prior to taking the time off, gives reasonable notice to the employer of the planned absence of the employee. Time off pursuant to this subparagraph shall not exceed 8 hours in any calendar month of the year.
      • To address a child care provider or school emergency, if the employee gives notice to the employer.
The employee shall utilize existing vacation, personal leave, or compensatory time off for purposes of the planned absence authorized by this section, unless otherwise provided by a collective bargaining agreement entered into before January 1, 1995, and in effect on that date. An employee also may utilize time off without pay for this purpose, to the extent made available by his or her employer. 
Organ & Blood Donation Leave
An employer is required to grant a leave of absence to an employee who is an organ donor or a bone marrow donor. The leave of absence to an organ donor is up to 30 days in a one-year period. The leave of absence for a bone marrow donor is up to 5 days in a one-year period. The leave of absence for either donor is not a break in his or her continuous service for the purpose of his or her right to salary adjustments, sick leave, vacation, annual leave, or seniority. 
 
In order to receive a leave of absence, an employee shall provide written verification to his or her employer that he or she is an organ or bone marrow donor and that there is a medical necessity for the donation of the organ or bone marrow.
 
An employer may require, as a condition of an employee’s initial receipt of bone marrow or organ donation leave, that an employee take up to five days of earned but unused sick leave, vacation, or paid time off for bone marrow donation and up to two weeks of earned but unused sick leave, vacation, or paid time off for organ donation, unless doing so would violate the provisions of any applicable collective bargaining agreement. Senate Bill – 272.

Last updated on: March 15th, 2019