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How does overtime pay work?

On Behalf of | Mar 19, 2024 | Employment Law |

Working overtime can be a great way to earn extra money. However, it can be slightly confusing to know when employers must provide overtime pay.

While employers are responsible for knowing overtime laws, employees should also understand them. Having this knowledge can ensure the correct pay for the hours worked.

Hour requirement

The law requires employers to pay employees overtime rates when they work more than eight hours in one day. Overtime pay is also a requirement for any hours worked beyond 40 in one week. There may be special rules for certain occupations, such as agricultural workers or some executive level employees, but employers should alert employees to these when they apply.

Payment amount

The overtime rate is 1.5 times the regular rate of pay. Employees receive this rate for all hours worked beyond eight in one day or 40 in one week.

If an employee works more than 12 hours in one day or works over eight hours on a seventh consecutive workday in a workweek, the rate increases to double the regular rate.

The regular rate depends on the average amount an employee earns. It can never be lower than the state minimum wage.

Eligible employees

California’s overtime pay regulations apply to most employees. This includes salaried, hourly, full-time and part-time. It also may apply to commissioned and piece-rate workers.

There are extensive exemptions under the law. These exemptions mean workers in specific occupations and industries, such as outside salespersons or participants in a national service program, are not eligible for overtime.

Overtime regulations aim to protect workers from exploitation and ensure they receive fair compensation for their labor. Employees can hold employers responsible for failing to comply with these requirements.