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Home > Employment Law > Wage & Hour > Exemptions from Overtime Under the FLSA and California Law

Exemptions from Overtime Under the FLSA and California Law

When it comes to employee rights and employer obligations, one of the most critical aspects is the determination of whether an employee is entitled to overtime pay. Both the Fair Labor Standards Act (FLSA) and California labor law provide guidelines on overtime, but they also include a confusing array of exemptions. For employers and employees alike, understanding these exemptions is crucial to ensure compliance and protect employee rights.

If you are an employee or small business employer in Ventura County with questions about minimum wage and overtime, contact Rounds & Sutter, LLP, to speak with an experienced Southern California employment lawyer serving clients in Oxnard, Ventura, Camarillo, and surrounding areas.

The Basics of Overtime Law

Under the FLSA, employees are generally entitled to overtime pay at a rate of one and a half times their regular pay for any hours worked over 40 in a workweek. California law goes further, requiring overtime pay for any hours worked over 8 in a day and double time for hours worked over 12 in a day. However, not all employees are eligible for overtime; certain exemptions apply that exclude specific workers from these overtime provisions.

Common Overtime Exemptions Under the FLSA

The FLSA outlines several exemptions where employees are not entitled to overtime pay. These include the well-known “white-collar” exemptions for executives, administrators and professionals, as well as exemptions for certain computer professionals and outside salespeople:

  1. Executive Exemption: Employees whose primary duty is managing the enterprise or a recognized department, who regularly direct the work of at least two full-time employees, and who have the authority to hire or fire employees.

  2. Administrative Exemption: Employees who perform office or non-manual work directly related to management or general business operations and who exercise discretion and independent judgment on significant matters.

  3. Professional Exemption: Employees whose primary duty involves performing work that requires advanced knowledge in a field of science or learning typically acquired through prolonged education.

  4. Computer Employee Exemption: Applies to employees in the computer field, including software developers, systems analysts, and other skilled computer professionals who meet specific compensation thresholds.

  5. Outside Sales Exemption: Employees whose primary duty is making sales or obtaining orders or contracts for services, and who are regularly engaged away from the employer’s place of business.

California’s Overtime Exemptions

California law mirrors many of the FLSA exemptions but imposes additional requirements. For an employee to be exempt under California law, they must meet specific salary and duty tests.

  1. Salary Threshold: As of 2024, the minimum salary for white-collar exempt employees in California is $66,560 annually for employers with 26 or more employees and $64,480 for employers with 25 or fewer employees. This salary must be a fixed amount not subject to reduction based on the quality or quantity of work performed. This figure is far above the “salary basis test” required by the FLSA. Computer workers in California, meanwhile, must be paid a whopping $55.58 per hour for all hours worked or a monthly salary of $9,646.96 and an annual salary of $115,763.35 to be exempt.

  2. Duties Test: In addition to the salary threshold, exempt employees must perform primarily (more than 50% of the time) executive, administrative, or professional duties as defined by state law. California’s interpretation of these duties is generally stricter than the FLSA, with a focus on the actual work performed rather than job titles or descriptions.

  3. Highly Compensated Employees: California does not recognize the FLSA’s exemption for highly compensated employees making an annual salary of $107,432 (and at least $684/week), meaning that even highly paid workers must still meet the state’s strict duties test to be considered exempt from overtime.

Miscellaneous Exemptions for California Employees

The above exemptions are the most common, but the list is not exhaustive. Other overtime exemptions may apply to:

  • Public employees
  • Close relatives of the employer
  • National service
  • Drivers
  • Employees covered by a collective bargaining agreement
  • Employees who work on commissions
  • Student nurses
  • Airline employees
  • Carnival ride operators
  • Crew members on a commercial fishing boat
  • Professional actors
  • Motion picture projectionists
  • News announcers and editors
  • Personal attendants not covered under the Domestic Worker Bill of Rights
  • Babysitters under 18 employed in the employer’s home

California employers must be especially vigilant in classifying employees correctly. Misclassification can lead to significant legal consequences, including back pay for unpaid overtime, penalties, and potential lawsuits. For businesses in Ventura County, this means not only understanding the federal guidelines under the FLSA but also the more stringent requirements under California law.

How Rounds & Sutter, LLP Can Help

If you are an employer uncertain about whether your employees qualify for overtime exemptions, or an employee who believes you have been misclassified, Rounds & Sutter, LLP can provide the legal guidance you need. Our experienced employment law attorneys serve clients in Oxnard, Ventura, Camarillo, and surrounding communities, helping ensure compliance with both state and federal laws.

At Rounds & Sutter, LLP, we are committed to protecting the rights of workers and advising employers on best practices to avoid costly legal issues. Whether you need assistance with employee classification, wage disputes, or other employment law matters, our team is here to help. Contact us today at 805-650-7100 to schedule a free consultation and learn more about how we can support your legal needs.