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Federal Rule Change Expected To Affect 420,000 Salaried Workers In California

On behalf of , P.C. posted in wage & hour law on Friday, August 7, 2015.

Federal employment laws generally set minimum standards for employee protections, including regulation of wages and work hours. States can pass more protective laws, however, and employers in those states must comply with those measures.

California has long been known as a state that provides a high and intricate level of wage-and-hour protections for employees, but an overtime-related change recently proposed by the federal government actually goes further than California state law in terms of overtime regulations.

Hourly workers nationwide are eligible to receive overtime pay — at 150 percent of their hourly rate — for each hour over 40 in a single week. But the rules are different for certain salaried workers.

Currently, salaried employees who perform administrative or executive duties, and who earn more than $23,660 a year, are exempt from eligibility for overtime pay. The proposal recently published by the U.S. Department of Labor would raise that annual pay threshold to $50,440. The rule change would make an estimated 4.6 million more Americans, including about 420,000 workers in California, eligible for overtime compensation.

It should be noted, too, that California labor law requires daily overtime pay, whereas federal labor law pertains to weekly overtime. Consequently, calculation of overtime is a bit more complicated in California. Here employers must account for work hours over eight in a day, as well as weekly totals.

How employers will respond to the rule change, which is expected to go into effect in early 2016, remains to be seen.

If you have questions about dealing with or preventing a wage-and-hour dispute in the Bay Area, then don’t hesitate to speak with an employment law attorney. At the Law Office of David C. Winton, we help employees and employers resolve labor disputes.

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