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The Fair Labor Standards Act offers protections for workers who are non-exempt employees. California’s Labor Code offers additional protections to non-exempt employees within the state. It’s important to understand the differences between exempt and non-exempt employees, as the classification will directly affect your rights in the workplace. Unfortunately, it’s not uncommon for employers to misclassify employees to deny them of their entitlements.

What Are The Differences Between Exempt And Non-Exempt Employees In California?

Under the federal Fair Labor Standards Act or FLSA, employers must classify their employees as either exempt or non-exempt. This classification determines whether the employee will be paid for overtime work and if minimum wage laws will apply.

Federal law requires that employers pay non-exempt employees an overtime rate of 1.5 times their regular hourly wage for any work done over forty hours per week. In California, overtime pay must also be paid for:

  • All hours worked over eight hours in a workday
  • The first eight hours worked on the seventh consecutive day of work in a workweek

Under the California Labor Code, employers are also required to pay double the hourly rate for:

  • All hours worked over 12 hours in a workday
  • All hours worked over eight hours on the seventh consecutive day in a workweek.

Federal law requires that non-exempt employees be paid a minimum of $7.25 per hour. In California, the minimum wage is much higher, given the increased cost of living in this state:

  • Californian employers with 25 or fewer employees must pay a minimum wage of $14.00 per hour.
  • Californian employers with more than 25 employees must pay a minimum wage of $15.00 per hour.
  • Within the city of San Francisco, the minimum wage is $15.59 per hour
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What Qualifies Someone As An Exempt Employee?

Exempt employees earn a salary rather than an hourly wage, but this is not the only qualification to be an exempt employee. Generally, employees qualify as exempt if they meet the following requirements:

  • Annual Earnings: Exempt employees must meet California’s minimum salary requirements. These requirements do not apply to teachers, certain sales employees, or those practicing law or medicine.
  • Duties: The exempt classification typically only applies to professional roles that require a greater level of expertise.
  • Independence: An exempt employee will have decision-making discretion and the authority to apply independent judgment.

Examples of exempt roles include:

  • Executives: These individuals must manage the company or a department or division. To qualify, the employee must also be managing at least two full-time workers and have the authority to promote, hire, and fire employees.
  • Professionals: They must perform work that requires advanced knowledge in a field of learning or science. These individuals have a high level of education and or training.
  • Administrative Employees: Their duties must include non-manual or office work that’s related to the management of the business or its operations.
  • Computer-Related Roles: They must work as computer programmers, computer analysts, software engineers, or another similar skilled role in the field. The Department of Labor outlines the duties that fall under this exemption.
  • Outside Sales: Qualifying employees make sales or obtain contracts/orders on commission and regularly work away from the employer’s primary place of business.

If an employee is considered a highly-compensated employee, they are also exempt from FLSA rules if their job scope includes the executive, professional, or administrative duties listed above.

It’s important to note that an employee’s job title doesn’t automatically qualify them as exempt or non-exempt. Employees with administrative or executive titles, for example, commonly qualify as non-exempt employees. The job duties and earnings—not the job title—qualify workers as exempt vs. non-exempt employees.

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What If My Employer Is Intentionally Misclassifying Me?

If you are a non-exempt employee and your employer is intentionally misclassifying you as exempt, they may be liable for:

  • Unpaid overtime for the period in which you were misclassified
  • Penalties equal to the amount owed to you

The state may also impose additional civil penalties or criminal charges for each violation.

Reporting the issue to your employer may resolve the problem, but legal action may be the next step if your employer refuses to reclassify you. In addition, intentional misclassification can be reported to California’s Division of Labor Standards Enforcement (DLSE) and the Federal Department of Labor.

How Can An Employee Rights Lawyer Help Me?

An employee rights lawyer knows and understands California’s employment laws. If an employer doesn’t classify you properly, it can lead to a significant loss in income. For example, if you’re classified as an exempt employee but don’t meet the state’s guidelines for exemption, you may work excess hours with no additional compensation.

If you are misclassified, a lawyer will help you seek:

  • Compensation for the unpaid hours
  • Penalties for not paying you properly

It’s crucial for any employee who believes an employer misclassifies them to seek legal advice as soon as possible. You may be missing out on compensation even if you’re receiving a “salary.”

If you believe that your employer has misclassified you, we can help.

We have years of experience helping employees fight against misclassification from their employers.

Call us to schedule an appointment to learn how we can help you receive the compensation you deserve.

Frequently (un)asked questions

It depends. A salaried employee may be considered exempt or non-exempt, depending on their monthly salary amount. Thus, a salaried employee who doesn’t meet the threshold of the state’s requirement may be non-exempt. In California, this figure currently stands at $62,400 for employers with 26 or more employees and $58,240 for employers with 25 or fewer employees.

Otherwise—if all requirements are met—generally speaking if a person’s salary is higher than a certain threshold, they’ll be considered an exempt employee.

For most employees, the main benefits of being an exempt employee are:

  • Guaranteed income
  • Potential for higher pay
  • High productivity can result in spending less time in the office

However, there may be times when an employer demands you work more than 40 hours a week, and you will not be compensated for this additional work.

Labor laws don’t put a limit on the number of hours an exempt employee must work. As long as the employee is 16 years of age or older, there are no guidelines on the number of days or hours in a week that an exempt employee must work.

Additionally, job duties may require additional hours to complete, and the employee must fulfill these duties without further compensation beyond their salaried pay.

Top-Rated Employee Rights Lawyer

Top-Rated Employee Rights Lawyer

If you suspect you’ve been misclassified as an exempt employee, causing you to miss out on overtime pay that you are entitled to receive, it’s difficult to know where to turn and whom you can trust. At the Malk Law Firm, we have successfully represented employees against large and small companies (all over California and Washington) in various labor and employment-related lawsuits.

Trust our team to fight for your rights in the workplace. Our employee rights lawyer is available for a consultation to discuss your options. Please reach out today to tell us about your case.

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