Tag Archives: California

NEW CASE: California Employers Beware – Business Owners Can Be Held Personally Liable For Wage And Hour Violations

In a recent case (Atempa v. Pedrazzani), the California Court of Appeal held that an owner of a restaurant can be held personally liable for violations of California’s wage and hour law.

In this case, two former employees of a restaurant filed a claim against the restaurant (business entity) and the owner of the restaurant (personally) for unpaid wages.  Specifically, the former employees claimed that they were not paid minimum wage and overtime in accordance with California law.

By including the owner of the restaurant in the lawsuit, the former employees were testing whether the amendments made to California Labor Code §558.1 through the A Fair Day’s Pay Act (SB 588) really meant that certain individuals could be held personally liable for wage and hour violations without first “piercing the corporate veil” (i.e. claiming that the employer engaged in fraud, failed to follow corporate formalities, or the company was inadequately capitalized). Continue reading NEW CASE: California Employers Beware – Business Owners Can Be Held Personally Liable For Wage And Hour Violations

NEW CASE: California Court Approves Employer’s Rounding Practice

In a recently-decided case (Donohue v. AMN Services, LLC), a California appellate court found that an employer’s rounding of employee’s time to the nearest 10-minute increment did not violate California law because the practice did not disfavor employees.

In this case, the plaintiff was a non-exempt nurse recruiter who worked for a healthcare staffing company.  The recruiters, including the plaintiff, logged their time using a computer-based timekeeping system.  Despite the fact that the computer-based timekeeping system logged employees’ punches in real time, the company had a practice of rounding employees’ time to the nearest 10 minutes (e.g. all punch times between 7:55 a.m. and 8:04 a.m. would record as 8:00 a.m., and all punch times between 8:05 a.m. and 8:14 a.m. would record as 8:10 a.m.).  The plaintiff filed a class action lawsuit against the employer claiming that the company’s rounding practice violated California law. Continue reading NEW CASE: California Court Approves Employer’s Rounding Practice

Is The Minimum Required Salary For Exempt Employees Increasing In Your State In 2019?

While the FLSA minimum salary requirements for “white collar” employees (executive, administrative, or professional employees) is not changing in 2019 (at least not until/unless the Department of Labor announces a new Overtime Rule), there are several states where the minimum salary requirements for exempt employees is increasing in 2019 (December 31, 2018 for New York employers).

These increases (i.e. in Alaska, California, Colorado, Maine, New York, and Oregon) are occurring because the minimum exempt salary rates for these employees (as established under state law) are scheduled to increase in 2018 (December 31st for New York employers).

Under the Fair Labor Standards Act (FLSA), the minimum salary requirements for white collar employees is as follows:

Payment Schedule Minimum Salary
Weekly $455
Bi-Weekly $910
Semi-Monthly $985.83
Monthly $1,971.66
Annual $23,660

The below table sets forth the changes to the minimum salary requirements for exempt employees in these states.  In those instances where the state minimum salary requirements are lower than the above-listed FLSA requirements, the higher salary threshold applies for employers who are subject to FLSA in order for employees to qualify for an exemption under the FLSA.

Alaska
Applicable Law: An individual employed in a bona fide executive, administrative, or professional capacity shall be compensated on a salary or fee basis at a rate of not less than two times the state minimum wage for the first 40 hours of employment each week, exclusive of board or lodging that is furnished by the individual’s employer. Alaska Stat. § 23.10.055(b).

 Since Alaska’s minimum wage is increasing to $9.89 per hour starting January 1, 2019, the minimum salary for exempt employees is increasing as follows:

Payment Schedule 2018 Minimum Salary 2019 Minimum Salary
Weekly $787.20 $791.20
Bi-Weekly $1,574.40 $1,582.40
Semi-Monthly $1,705.60 $1,714.27
Monthly $3,411.20 $3,428.53
Annual $40,768 $41,142.40
California
Applicable Law: Overtime-exempt executive, administrative and professional employees must earn a monthly salary equivalent to at least two times the state minimum wage for full-time employment. IWC Wage Orders.

 Since California’s minimum wage is increasing to $11.00 per hour (for employers with 25 or less employees) and $12.00 per hour (for employers with 26 or more employees) starting January 1, 2019, the minimum salary for exempt employees is increasing as follows:

Small Employers (25 or less employees)
Payment Schedule 2018 Minimum Salary 2019 Minimum Salary
Weekly $840 $880
Bi-Weekly $1,680 $1,760
Semi-Monthly $1,820 $1,906.67
Monthly $3,640 $3, 813.34
Annual $43,680 $45,760
Large Employers (26 or more employees)
Payment Schedule 2018 Minimum Salary 2019 Minimum Salary
Weekly $880 $960
Bi-Weekly $1,760 $1,920
Semi-Monthly $1,906.67 $2,080
Monthly $3,813.34 $4,160
Annual $45,760 $49,920
Colorado**
Applicable Law: Exempt executive/supervisory employees must be a salaried employee earning in excess of the equivalent of the minimum wage for all hours the employee worked in a workweek. Colorado Minimum Wage Order.

Note: The administrative and professional exemptions only require that an employee be a “salaried individual” and does not provide a minimum salary requirement.

 Since Colorado’s minimum wage is increasing to $11.10 per hour starting January 1, 2019, the minimum salary for exempt executive/supervisory employees is increasing as follows:

Payment Schedule 2018 Minimum Salary* 2019 Minimum Salary*
Weekly $408 $444
Bi-Weekly $816 $888
Semi-Monthly $884 $962
Monthly $1,768 $1,924
Annual $21,216 $23,088
* These numbers are based on the employee working 40 hours per week.  If the employee works more than 40 hours per week, the required pay will be greater.
** In order for an executive employee to meet the minimum salary requirement under the FLSA, the employee will need to be paid the FLSA minimum salary.  However, once that employee works over 41 hours in a week, the state minimum wage salary requirement will apply.
Maine
Applicable Law: The minimum salary requirement to qualify for an executive, professional or administrative exemption is 3,000 times the Maine minimum hourly wage or the minimum salary required by the federal Fair Labor Standards Act, whichever is higher. 26 M.R.S 663(3)(K).

 Currently, the state threshold is higher than the FLSA threshold; therefore, the state threshold applies.

Since Maine’s minimum wage is increasing to $11.00 per hour starting January 1, 2019, the minimum salary for exempt employees is increasing as follows:

Payment Schedule 2018 Minimum Salary 2019 Minimum Salary
Weekly $576.92 $634.61
Bi-Weekly $1,153.84 $1, 269.23
Semi-Monthly $1,250 $1,375
Monthly $2,500 $2,750
Annual $30,000 $33,000
New York – INCREASES 12/31/2018
Applicable Law: Exempt executive and administrative employees must be paid at least the minimum salary set forth in the applicable New York Wage Orders.

 Note: There is no salary basis test for professional employees under New York law.

Under the amendments to the New York Wage Orders, the minimum salary for exempt executive and administrative employees is increasing on December 31, 2018 as follows:

New York City (11 or More Employees)
Payment Schedule Current Minimum Salary Minimum Salary On 12/31/18
Weekly $975 $1,125
Bi-Weekly $1,950 $2,250
Semi-Monthly $2,112.50 $2,437.50
Monthly $4,225 $4,875
Annual $50,700 $58,500
New York City (10 or Fewer Employees)
Payment Schedule Current Minimum Salary Minimum Salary On 12/31/18
Weekly $900 $1,012.50
Bi-Weekly $1,800 $2,025
Semi-Monthly $1,950 $2,193.75
Monthly $3,900 $4,387.50
Annual $46,800 $52,650
Nassau, Suffolk & Westchester Counties
Payment Schedule Current Minimum Salary Minimum Salary On 12/31/18
Weekly $825 $900
Bi-Weekly $1,650 $1,800
Semi-Monthly $1,787.50 $1,950
Monthly $3,575 $3,900
Annual $42,900 $46,800
Remainder of State
Payment Schedule Current Minimum Salary Minimum Salary On 12/31/18
Weekly $780 $832
Bi-Weekly $1,560 $1,664
Semi-Monthly $1,690 $1,802.67
Monthly $3,380 $3,605.34
Annual $40,560 $43,264
Oregon*  – INCREASES 7/1/2019
Applicable Law: The minimum salary requirement to qualify for an executive, professional or administrative exemption is the applicable minimum wage multiplied by 2,080 hours per year and then divided by 12 months. Or. Rev. Stat. § 653.010(9).

 Since Oregon’s minimum wage is increasing to $11.00 per hour (for employers in “nonurban counties”), $12.50 per hour (for employers in the Portland metropolitan area), and $11.25 per hour (for the remainder of the state) starting July 1, 2019, the minimum salary for exempt employees will be increasing as follows:

Nonurban Counties (Baker, Coos, Crook, Curry, Douglas, Gilliam, Grant, Harney, Jefferson, Klamath, Lake, Malheur, Morrow, Sherman, Umatilla, Union, Wallowa, and Wheeler counties)
Payment Schedule Current Minimum Salary Minimum Salary On 7/1/19
Weekly $420 $440
Bi-Weekly $840 $880
Semi-Monthly $910 $953.34
Monthly $1,820 $1,906.67
Annual $21,840 $22,880
Portland Metropolitan Area
Payment Schedule Current Minimum Salary Minimum Salary On 7/1/19
Weekly $450 $500
Bi-Weekly $900 $1,000
Semi-Monthly $975 $1, 083.34
Monthly $1,950 $2, 166.67
Annual $23,400 $26,000
Remainder of the State
Payment Schedule Current Minimum Salary Minimum Salary On 7/1/19
Weekly $430 $450
Bi-Weekly $860 $900
Semi-Monthly $931.67 $975
Monthly $1,863.33 $1,950
Annual $22,360 $23,400
NOTE:  Currently, only employers in the Portland metropolitan area must pay the state salary in order for to qualify for an executive, professional or administrative exemption.  All other employers in Oregon must pay the FLSA minimum salary in order for to qualify for an executive, professional or administrative exemption.

While not increasing, the minimum salary requirements to qualify for an executive, professional or administrative exemption is higher than the FLSA threshold in the following states:

Connecticut
Applicable Law: The minimum salary requirement to qualify for an executive, professional or administrative exemption is $475 per week. Regs., Conn. State Agencies § 31-60-14.
Payment Schedule Current Minimum Salary
Weekly $475
Bi-Weekly $950
Semi-Monthly $1,029.17
Monthly $2,058.33
Annual $24,700
Iowa
Applicable Law: The minimum salary requirement to qualify as a “high-salaried” executive, professional or administrative employee (and qualify for an exemption from overtime if the duties test is also met) is $500 per week. 875 Iowa Admin. Code 218.1-218.3.
Payment Schedule Current Minimum Salary
Weekly $500
Bi-Weekly $1,000
Semi-Monthly $1,083.34
Monthly $2,166.67
Annual $26,000

Recommendation for Employers

It is recommended that employers in these states verify that their exempt employees are receiving at least the minimum salary requirement to qualify for the exemption.

Also, please remember that meeting the salary requirement is just one element needed to qualify for an exemption from overtime.  The employee in question must also meet the duties test and the salary basis test.

NEW LAW — Minimum Wage Increases for Certain California Cities

Attention employers in Mountain View and Sunnyvale, California … minimum wage in these cities is increasing on January 1, 2019.

For employers in both Mountain View and Sunnyvale,  minimum wage is increasing from $15.00 to $15.65 per hour on January 1, 2019.

Employers in these cities should prepare for the increase and download the update minimum wage poster available here:

NEW LAW: Berkeley, California’s Minimum Wage to Increase October 1, 2018

Reminder for Berkeley, California employers … on October 1, 2018,  the city Berkeley’s minimum wage increased from $13.75 to $15.00 per hour.

It is recommended that all Berkeley employers verify that their employees are being paid the appropriate minimum wage rate.

NEW LAW: San Diego, California’s Minimum Wage to Increase January 1, 2019

San Diego employers, mark your calendars!

The San Diego City Treasurer recently announced that on January 1, 2019, the city of San Diego’s minimum wage will increase from $11.50 to $12.00 per hour. 

It is recommended that all San Diego employers prepare for this increase and download the revised minimum wage poster for 2019.

NEW LAW: New Requirements For California Talent Agencies

California Governor Jerry Brown recently signed Assembly Bill 2338 into law.  This new law places new training requirements for talent agency employers.

First, talent agencies must make educational materials regarding sexual harassment prevention, retaliation, and reporting resources to an adult artist within 90 days of the talent agency agreeing to represent that artist.  The materials must be in the language understood by that artist and must include, at a minimum, the components specified in the Department of Fair Employment and Housing’s Form 185.

In addition to the above materials, talent agencies must also provide the artist with educational materials regarding nutrition and eating disorders within 90 days of the talent agency agreeing to represent that artist.  The materials must be in the language understood by that artist and must include, at a minimum, the components specified in the National Institute of Health’s Eating Disorders Web site (www.nimh.nih.gov/health/topics/eating-disorders/index.shtml).

Finally, prior to issuing an entertainment work permit to a minor (between 14 to 17 years of age), the parent/legal guardian and the minor must receive and complete training in sexual harassment prevention, retaliation, and reporting resources.  The training must be administered by a third-party vendor, on-site, electronically, via Internet Web site, or other means. The training must be in the language understood by that the minor and his guardian and must include, at a minimum, the components specified in the Department of Fair Employment and Housing’s Form 185.

This new law goes into effect on January 1, 2019.

NEW LAW: California Expands Existing Lactation Accommodation Law

California Governor Jerry Brown recently signed Assembly Bill 1976 into law.  This new law amends California’s existing lactation accommodation law and places new responsibilities on employers.

Under the old lactation accommodation law (California Labor Code 1030, et. seq.), an employer was merely required to do the following to accommodate the nursing mother:

  • provide a reasonable amount of break time, which should, if possible, run concurrently with any break time already provided to the employee; and
  • 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.

Under the new law, which goes into effect on January 1, 2019, the employer’s obligations are greatly expanded.  The first change is that the law makes it clear that the employer must provide the employee with the use of a room or other location, other than a bathroom, that is close to the employee’s working space to privately express milk.

The law also permits an employer to makes a temporary lactation location available to an employee, provided that all of the following conditions are met:

  • The employer is unable to provide a permanent lactation location because of operational, financial, or space limitations.
  • The temporary lactation location is private and free from intrusion while an employee expresses milk.
  • The temporary lactation location is used only for lactation purposes while an employee expresses milk.
  • The temporary lactation location otherwise meets the requirements of state law concerning lactation accommodation.

The new law also addresses how agricultural employers can meet the new requirements.  Specifically, the law states that an agricultural employer shall be considered to be in compliance with this law if the agricultural employer provides an employee wanting to express milk with a private, enclosed, and shaded space, including, but not limited to, an air-conditioned cab of a truck or tractor.

It is recommended that all California employers review their policies and procedures with respect to accommodating nursing mothers to verify that they will be in compliance with the new law come January 1, 2019.

San Francisco Amends “Fair Chance Ordinance” to Expand On California’s Ban-the-Box Law

Recently, the San Francisco Board of Supervisors passed amendments to the city’s 2014 Fair Chance Ordinance (FCO), which will expand upon the State’s “ban the box” initiative by further limiting an employer’s ability to obtain and use information about an applicant’s criminal history.

FCO Amendment

The amendments will go into effect on October 1, 2018 and will affect all employers with five or more employees nationwide that have at least one employee who works on average 8 or more hours per work in San Francisco. This expands on the existing ordinance which was limited to city-based employers with twenty or more employees nationwide.

Expansions to Existing Law

While the majority of the amendments are designed to bring the city’s outdated ordinance into alignment with the State’s new ban-the-box law, one amendment goes further and will prohibit employers from considering any convictions for crimes that have since been decriminalized regardless of when the conviction occurred.  As an example of such decriminalized activity, the amendments specifically reference certain offenses for non-commercial use and cultivation of marijuana that were recently decriminalized under state law. Continue reading San Francisco Amends “Fair Chance Ordinance” to Expand On California’s Ban-the-Box Law

California Adopts New Test for Independent Contractors

On April 30, 2018, in a departure from well-established precedent, the California Supreme Court held that the proper standard for determining whether a worker is an independent contractor or an employee under the state Wage Orders is the “ABC” test.  Prior to this ruling, courts and the California Division of Labor Standards Enforcement had utilized the multi-factor balancing test established by the court in Borello & Sons, Inc. v. Dep’t of Indus. Relations for this determination.

This decision will make it much more difficult for employers to classify workers as independent contractors with potentially far reaching implications including subjecting them to liability for misclassification which could include back payment of federal Social Security and payroll taxes, unemployment insurance taxes and state employment taxes, workers’ compensation premiums, and unpaid minimum wages and overtime wages and penalties associated with failure to pay proper wages.

The Old Rule (Borello) Continue reading California Adopts New Test for Independent Contractors