California Overtime Law (2021)
Most US states are unified when it comes to most of their rules and regulations on work time and overtime. These rules and regulations are usually covered with the FLSA - a federal law valid across the US. However, some states, including California, have their own, more specific laws that override the more general FLSA rules and regulations. Here's how California law treats overtime.
Does California have overtime after 8 hours or 40 hours?
In California, overtime is officially counted both after 8 hours of work per day, AND 40 hours per week - according to the California Labor Code Section 510, i.e. The Cunningham Law.
So, if you work 9 hours on Tuesday, you are entitled to get paid for 1 hour of overtime.
Moreover, if you work 42 hours in total during a week, you are entitled to get paid for 2 hours of overtime.
Here's how overtime in California works in more detail.
How do regular rates and overtime rates correlate?
The overtime rates in California are based on regular rates.
For hourly employees, regular rates are the rates they get paid per hour during a 40-hour workweek. If they get paid two different rates, overtime is calculated according to the average of the two rates (e.g. $20 + $25 / 2 = $22.5).
For salaried employees, regular rates are calculated by dividing the annual salary by 52 weeks in a year, and 40 work hours in a week (e.g. $30,000 / 52 / 40 = $14.42).
How do you calculate overtime in California?
Let's look at a quick breakdown of the overtime rules in California:
|TIME WORKED IN TOTAL||THE OVERTIME RATE|
|> 8 hours in a workday||the regular hourly rate x 1.5|
|> 40 hours in a workweek||the regular hourly rate x 1.5|
|the first 8 hours on the 7th consecutive day of work||the regular hourly rate x 1.5|
|> 12 hours in a workday||the regular hourly rate x 2|
|> 8 hours on the 7th consecutive day of work||the regular hourly rate x 2|
So, according to the California overtime law, employers need to pay employees 1.5 times their regular hourly rates after 8 hours of work per day on weekdays and Saturdays.
The California Labor Codes 551 and 552 prescribe that the employees must have at least one day of rest during the week. However, in certain situations, they may need to work the 7th consecutive day in a week.
For this purpose, the first 8 hours an employee works on the 7th consecutive day of work are always counted as 1.5 overtime.
For example, if an employee with a $30 regular hourly rate works 9 hours over 5 weekdays, the employer has to pay $45 for 5 overtime hours (8+1 over 5 days). In total, that amount to $465 of weekly pay (8 x $30 + 5 x 45$).
In addition, double time pay requirements state that an employer needs to pay employees 2 times their regular hours after 12 hours of work per day. Moreover, all the time spent working past 8 hours on the 7th consecutive day of work are also to be paid double the regular rates.
For example, this means that an employee with a $30 regular hourly rate working 13 hours for two weekdays will need to be paid $60 for 2 double overtime hours. In total, that amounts to $960 of weekly pay (16 x $30 + 8 x $45 + 2 x $60).
Moreover, the regular hourly rate cannot be smaller than the official minimum wage in California.
What is the minimum wage in California?
The California law of 2019 dictates that all non-exempt employees be paid at least $12 per hour, as a minimum wage for companies that employ 26 or more employees. Or, at least $11 per hour for companies that employ 25 employees or less.
However, in 2020, the minimum wage in California is set to rise to $13 per hour worked for companies that employ 26 or more employees. Or, $12 per hour for companies with 25 employees or less.
Moreover, the minimum wage in California is slated to steadily increase in the future, at least until 2023.
|YEAR||26 OR MORE EMPLOYEES||25 OR LESS EMPLOYEES|
Some states count tips employees receive towards minimum wages. This is not the case in California, where tips are NOT counted towards the minimum wage.
In addition to California's overall higher minimum wage (the official US minimum wage according to the federal law is $7.25), some California cities also have their own local minimum wages:
- $13.80 - Oakland
- $15 - Berkeley, Cupertino, El Cerrito, Los Altos, Milpitas, Palo Alto, San Francisco, San Jose, San Mateo, and Santa Clara
- $15.65 - Mountain View and Sunnyvale
- $16 - Emeryville
Minimum wages also apply to overtime calculations, just like any other rate. So, if the employees are paid the minimum wage, then their 1.5 higher overtime rates are counted according to the minimum wage. The same goes for their double overtime rates.
California overtime calculator example
For example, an employee with a $20 regular hourly rate may have the following weekly salary breakdown:
- Regular hourly rate: $20
- 1.5 overtime rate: 1.5 x $20 = $30
- Double overtime rate: 2 x $20 = $40
- Sunday is treated as the 7th consecutive day of work
|Hours worked||9h||13h||8h||8h||10h||9h||11h||Total number of hours worked: 68h|
|Regular hours||8h||8h||8h||8h||8h||8h||/||Total 1.5 overtime: 16h|
|1.5x overtime||1h||4h||/||/||2h||1h||8h||Total 1.5x overtime pay: $480|
|Double overtime||/||1h||/||/||/||/||3h||Total double overtime: 4h|
|Pay calculations||(8h x $20) + (1h x $30)||(8h x $20) + (4h x $30) + (1h x $40)||(8h x $20)||(8h x $20)||(8h x $20) + (2h x $30)||(8h x $20) + (1h x $30)||(8h x $30) + (3h x $40)||Total double overtime pay: $160|
|Total pay for the day||$190||$320||$160||$160||$220||$190||$360||The total pay for the week: $1,600|
That's the calculation layout for a typical work week.
Employees may need to carry out these calculations if they fear they are owed some back-dated overtime pay.
If you're an employee, you can carry out these calculations manually, by using this calculation layout as a guide.
Or, you can use an automatic overtime calculator, for a faster and more precise turnaround.
What is California Labor Code 511?
There are some sections of the California overtime law that treat the matter of overtime differently.
According to the California Labor Code Section 511, an employer may require the employees to work more than 8 hours per day as a norm.
Namely, they may schedule 10-hour shifts for 4 days in a week. In such a case, employees are NOT entitled to be paid 1.5 overtime for the 2 extra hours, considering that they are not expected to work only 8 hours in the first place. Moreover, they are still working no more than 40 hours per week.
However, the employer will first need to present the case for such an alternative workweek in front of a “readily identifiable” work unit.
In any case, if the employees still work more than the scheduled 10-hours shifts, they are entitled to be paid overtime.
If they work up to 12 hours per day during their 10-hours shifts, they are entitled to be paid 1.5 times their regular hourly rates.
If they work more than 12 hours per day during their 10-hours shifts, they are entitled to be paid 2 times their regular hourly rates.
Who is exempt from overtime in California?
The California overtime law recognized exempt and non-exempt employees, according to the FLSA.
As previously mentioned:
- Non-exempt employees ARE entitled to be compensated for their overtime hours
- Exempt employees are NOT entitled to be compensated for their overtime hours
It's very important to classify employees properly.
If an employer fails to do so, he or she may need to pay back-wages and suffer other penalties, as prescribed by the California law.
According to the California Labor Law, employees are exempt under the following conditions:
- They get paid a monthly salary of no less than 2 times the California minimum wage
- They are engaged in specific fields of work: creative, intellectual, or managerial
- They are engaged in work that requires discretion
- They are engaged in work that required independent judgment
Apart from these conditions, there are certain types of professions that are always usually counted as exempt:
- Commissioned employees
- People working in administration
- Computer professionals
- Teachers in private schools
- Outside salespeople
- Truck Drivers
In addition to this list, union employees are also not paid 1.5 and double overtime - but, that's because their unions usually prescribe different overtime rates (usually $3.30 per overtime hour).
Unless the employer is absolutely certain that the employee should be classified as exempt (in accordance with all the above-mentioned rules), the employee in question must be classified as non-exempt.
Do salaried employees get paid overtime in California?
It depends on whether they're classified as exempt or non-exempt from the Federal Labor Standards Act.
Usually, non-exempt employees are the ones paid by the hour.
But some salaried employees may also be non-exempt:
- Non-exempt salaried employees ARE entitled to get paid overtime.
- Exempt salaried employees are NOT entitled to get paid overtime.
If salaried employees are getting paid at least twice the minimum hourly wage for a 40-hour workweek, they are exempt from getting paid for overtime. However, if they're not getting paid as much, they cannot classify to be exempt from overtime.
In numbers, that amounts to $49,920 per year, for companies with more than 25 employees (2 x $12 x 40 hours per week x 52 weeks per year). For companies with 25 or fewer employees, that amounts to $45,760 per year (2 x $11 x 40 hours per week x 52 weeks per year).
These numbers have been valid since January 1, 2019 - but they are expected to change with the rise of the minimum wage.
So, if you currently make less than $49,920 or $45,760 per year, you qualify as a non-exempt employee entitled to be paid overtime - unless you fall under exempt employees based on your position at work or choice of profession.
Learn more about salary vs hourly and exempt vs non-exempt employees here
What are the age requirements to qualify for overtime in California?
An employee is entitled to be paid overtime if he or she is at least 18 years old, or older.
Moreover, an employee may be entitled to be paid overtime after the age of 16 - but, only if he or she is legally allowed to leave school in order to pursue employment.
What is the new overtime law in California?
The new overtime law in California is tied to calculating employee weekly pay based on flat-bonuses they receive for overtime.
The following new law was established after the ruling in the Alvarado v. Dart Container Corp. of California case. The case was caused by a dispute in the amount employees in Dart Container Corp. were supposed to receive as a bonus for completing their weekend shifts.
To explain the new law (and its difference with old practices), let's take the following numbers for our example calculations:
- $25 hourly rate
- 50 hours worked in total
- A flat bonus of $200 as a base
❌ Dart Container Corp. total pay calculations
Dart Container Corp. used the federal formula to calculate the weekly pay of employees - based on the total number of hours worked:
- Dart Container Corp's calculated the regular pay rate by multiplying the regular rate per hour with the total number of hours worked:
$25 x 50 = $1,250
- Then, they added this weekly amount to the received bonus, and divided it by the number of total hours worked:
$1,250 + $200 / 50 = $29
- According to the FLSA and the overtime rate for the employee ($29 x 1.5 = $43.5), the employee would then be entitled to an amount of $1,595 for that week (40 x $29 + 10 x $43.5).
However, that turned out to be a legally problematic calculation.
✅ Alvarado's total pay calculations
The other party in the case, Hector Alvarado complained that the Dart Container Corp. was underpaying its employees because it wasn't following the California's Division of Labor Standards Enforcement (DLSE) Manual.
According to Alvarado (and the said Manual), Dart Container Corp. should have used only the number of non-overtime hours worked for the divisions, and not the total.
- If we take the same numbers from the previous example, that means $1,450 should be divided by 40 and not 50, for a base rate of $36.25.
- Which amounts to $1,993.8 of total weekly pay owed ($36.25 x 40 + $54.38 x 10 = $1,450 + $543.8 = $1,993.8).
The ruling of the Alvarado v. Dart Container Corp. of California case was added to the California overtime law - and all overtime based on flat-bonuses should be calculated accordingly.
What else do you need to know about overtime in California?
- Under certain circumstances, it may be illegal to prescribe mandatory overtime, even when it's properly paid
- The employee's right to collect overtime pay cannot be waived
- The amount the employees collect for overtime (1.5 times more for >8 hours and 2 times more for >12 hours) cannot be waived
- Commute time doesn't count towards regular work time or overtime
- Travel time for merchandisers counts as work time, except the work commute time to and from their homes
- Time spent traveling for business may count towards overtime - if it makes the employee accrue more than 40 work hours per week or 8 hours per day
- If the employer knows the employee is working overtime, even if this time is not officially specified in the timesheet, the employee is still entitled to be paid for this overtime
- The California law does not require the employees to work more than 72 hours per week - i.e. they CAN legally refuse to work more than 72 hours during a week without being sanctioned by their employers
- Paid rest breaks (employees in California are entitled to such breaks after every 4 hours of work) ARE included when calculating overtime
- On-call time may count towards overtime if it makes the employee accrue more than 40 hours of work per week or 8 hours of work per day
How to track overtime hours in California?
As we've already seen, California has significantly different overtime laws when compared to other US states.
However, the methods in which you can track this overtime always stays the same across the US.
Your fastest and most efficient solution is to track time with time tracking software.
Tracking overtime with Clockify
Clockify helps you track the time you spend on individual tasks and projects - both regular hours and overtime.
To track time with Clockify, simply start the timer when you start working on a task and stop it once you're done working. At the end of the day, the total time you tracked on all your tasks counts as your total hours worked for that day.
To have your pay automatically calculated based on your hours worked, all you need to do is specify your hourly rates and mark each time entry you make for work during work hours as billable. Then, you'll be able to view your earnings in the Reports section of the app.
Let's see how tracking overtime works if you have a regular rate of $20 per hour. For this purpose, we'll need to create 3 projects - one for your regular hours, one for your 1.5 overtime, and one for your double overtime:
First, create a project for your Regular Hours, and define your regular hourly rate for it ($20). Here, you'll be tracking your first 8 hours per day.
Then, create a separate project for your 1.5 Overtime, and define your 1.5 overtime hourly rate (1.5 x $20 = $30).
Here, you'll be tracking the time you spend working past 8 hours per day, but less than 12 hours per day; and the first 8 hours you spend working on the 7th consecutive day of work
Next, create a separate project for your Double Overtime, and define your 2 overtime hourly rate (2 x $20 = $40).
Here, you'll be tracking the time you spend working past 12 hours per day, and all time spent working past the first 8 hours on the 7th consecutive day of work.
As an alternative to tracking time in real-time in the Time Tracking page, you can also add time manually on the same page, or add it manually in the app's timesheet page.
For the purpose of adding time manually in the timesheet, you can select the same 3 projects you've previously created.
Managing the overtime tracked with Clockify
After adding your time for that week, you can run regular Visual Reports to see how much time you've spent working overtime and regular hours for the whole week.
After all, you don't want to overwork yourself to burnout or realize that you're working more than the legally recommended maximum of 72 hours per week.
This way, you'll also get a comprehensive breakdown of your work hours and pay.
You can further classify your time entries with tags, projects, clients, and tasks.
However, if you're just looking to calculate your overtime hours and pay in general for each day, the first 3 steps will always be more than enough. You'll get your regular, 1.5 overtime, and double overtime hours calculated according to California overtime law, fast, and with complete precision.