Wage and hour law attorney | lawyer in Sacramento
Wage and Hour Law
What is Wage and Hour Law?
Generally speaking, wage and hour law is related to the payment of wages: minimum wage, overtime, and meal and rest breaks. While many believe that these issues have long since disappeared in the modern age, nothing could be further from the truth. Employers, often looking to increase profit margin, are increasingly improperly classifying employees as “exempt” and paying them a salary so that minimum wage, overtime, and breaks can be avoided. In fact, as recently as 2005, the largest corporation in the world, Wal-Mart, was ordered by the Alameda County Superior Court to pay $172 million for denying lunch breaks to their employees. (See the Wall Street Journal Article)
Often these cases are handled as class action lawsuits. One of the reasons they are handled as class actions is related to the fact that some employers can unlawfully deprive employees of wages, breaks, overtime, etc. and the amount due each individual employee is relatively small. However, when you add up all of the money that the employer is denying each employee, the amounts can be staggering (as in the Wal-Mart case.) Each case should be analyzed on its own, which includes input from the client, as to whether or not a class action is appropriate. The following topics provide a summary of what employees are covered by wage and hour law and the rights and remedies of some of the most commonly litigated topics.
Exempt vs. non-exempt
Most employees believe that if they are being paid a salary that they are exempt from the protections of California wage and hour law. This is not always the case. The fact that your employer has decided to classify you as “exempt” does not mean that under the law you should be so classified. What the employer decides to do, even if you agreed with the decision or you signed a contract, does not determine whether or not you are properly classified as exempt. In fact, many wage and hour cases involve determining whether or not employees who have been classified as exempt by the employer for years have been correctly classified under the law. In many cases, when the employer loses this battle it can be very costly. For example, in 2001, a California Court awarded approximately $90 million to Farmer’s Insurance claims adjusters who had been improperly classified as exempt and denied overtime pay.
To determine whether or not you have been properly classified as exempt requires a complex legal analysis and depends on your job classification. The law provides exemptions for different types of jobs, which are too numerous to list here. Generally speaking, exemptions include the “white collar” type of jobs, specifically known in this area of law as the administrative, professional, and professional exemptions. But each job requires a legal analysis. It is not safe to assume you have been properly classified as exempt merely because your job sounds like it might fall under one of these exemptions. Furthermore, depending on the type of job you are performing, some positions are exempt from some protections of the law, but not others. For example, outside salespersons are generally exempt from only the minimum wage and overtime protections, but qualify for other protections/remedies. If you are reading this article, there is a good chance that you at least believe that you may have been improperly classified as exempt, and therefore you should consult with a qualified employment attorney to determine if your rights have been violated.
It is not unusual for an employer to classify an employee as “management” in order to avoid paying overtime and minimum wage, even though only a small percentage of that employee’s duties would be considered under the law to be management (or “exempt”) duties. If you have been classified as management and you do not believe this is a correct classification, you should contact an employment attorney immediately to determine your rights under the law.
Technology employees
Similarly, there are an increasing number of technology employers who are misusing the exemption for “highly-skilled computer professionals.” This rule applies to computer systems analysts, computer programmers, software engineers, and other similarly skilled employees in the computer software field. However, in order for these employees to be exempt, they must be earning at least $455 per week on a salary basis or $27.63 per hour on an hourly basis, AND the employee’s primary duty must consist of one of the following: (1) the application of systems analysis techniques and procedures, including consultation with users, to determine hardware, software, or system functional specifications; (2) the design, development, documentation, analysis, creation, testing, or modification, of computer systems or programs, including prototypes, based on and related to user or system design specifications; (3) The design, documentation, testing, creation, or modification of computer programs related to machine operating systems; or (4) a combination of the duties identified in (1)-(3) above, the performance of which requires the same level of skills.
Again, the exemption test can be extremely complicated, requiring the analysis of a qualified employment attorney. If you believe you have been misclassified, contact our office to schedule a free consultation.
Failure to pay wages
Nothing can be more frustrating or financially devastating as having an employer fail to timely pay wages due. When an employer fails to pay wages owed, the employee’s daily rate of pay is calculated and the employer owes the employee one day’s pay for every day that the wages have not been paid, up to thirty days. There are other remedies and penalties, as discussed below, in addition to interest and attorneys’ fees.
Minimum Wage
The minimum wage in the State of California is currently $7.50 per hour. On January 1, 2008, the minimum wage will be $8.00 per hour. Most exempt employees must earn at least the minimum wage, regardless of whether they are hourly or salaried employees. It does not matter if your employer has convinced you to agree to work for less than the minimum wage – that is an invalid agreement under the law.
If you have been paid less than the minimum wage, under the law you may be entitled to the wages you should have been paid, doubled, plus interest and attorneys’ fees, going back as many as four years. In other words, if you were paid $7 per hour while the minimum wage was $7.50 per hour, you would be entitled to 50 cents for every hour worked plus a “liquidated damage penalty” of double what you should have earned ($7.50 more for every hour you were not paid minimum wage). This can add up to be a substantial sum, particularly if your co-workers join the lawsuit, or the case becomes a class action.
In addition, there are civil penalties that can be assessed against the employer for failure to pay minimum wage. In some cases, the employee is entitled to also collect these penalties as a “private attorney general.” This penalty imposes a “fine” of $100 for the first pay period the employee is underpaid, and $250 for each pay period thereafter. This amount is for each employee. There are other remedies and penalties, as discussed below, in addition to interest and attorneys’ fees.
Overtime
As is the case with minimum wage violations, an employer’s repeated violations can add up to a substantial verdict, especially over a long period of time and a large number of employees. In the State of California, non-exempt employees are entitled to “time and a half” (1.5 x the regular rate of pay) for every hour worked over eight hours in one day or forty hours in one week. The non-exempt employee is also entitled to double time for every hour worked over twelve hours in one day or on the seventh day in a row of work (regardless of how many hours were worked in each of the preceding days). If you qualify for overtime and your employer has failed to properly compensate you may be entitled to the wages you should have been paid, doubled, plus interest and attorneys’ fees, going back as many as four years. In other words, if you were paid $8 per hour and you accrued 10 hours of overtime in a given week, you would be entitled to your overtime ($4 x 10 hours) plus a “liquidated damage penalty” of double what you should have earned (10 hours at $12 per hour). This can add up to be a substantial sum, particularly if your co-workers join the lawsuit, or the case becomes a class action. There are other remedies and penalties, as discussed below, in addition to interest and attorneys’ fees.
Failure to furnish accurate wage statements
If your employer does not furnish accurate wage statements, which almost always occurs if you have been misclassified as exempt, or have not been compensated at the minimum wage or paid overtime (if required), the employee is entitled to recover $50 for the initial violation (first pay period) and $100 for each subsequent violation, up to a maximum of $4,000. This amount applies to each employee who was not furnished an accurately itemized wage statement.
Contact our office to discuss your case
This article discusses only some of the issues and remedies to which an employee may be entitled for wage and hour violations. The article does not include federal law or federal remedies, which in some cases may change the amount to which an employee is entitled. Wage and hour issues are very case specific and require an analysis by a qualified employment attorney to determine if your rights have been violated and the remedies to which you are entitled. Please contact us to discuss your case. You can tell us about your case confidentially https://jfultonlaw.c4.ixwebhosting.com/wageandhour_violations_form.htm, or call us at (916) 441-5566.
