Saturday, February 4, 2023

Salary Just One Part of California Requirements for Overtime Exemption


I just read an article about paying employees for the time they spend using their personal cell phones for company business, and it said that if my employee earns more than $100,000 per year, he/she is exempt from overtime. Is this true in California?

Not necessarily. The article you read must have been referencing the federal Fair Labor Standards Act regulations.

Employers and employees in California are covered by both federal and state laws. Employers in California must abide by whichever law provides greater protection or advantages to its employees.

Federal Exemption

The federal laws relating to wages and hours for employees are set forth in the Fair Labor Standards Act (29 U.S. Code, Chapter 8). Section 13(a)(1) does provide an exemption from the federal overtime and minimum wage requirements for highly compensated employees (those earning in excess of $100,000 per year).

California Law

California law, however, does NOT have a similar exemption. In California, for an employee to be exempt from overtime obligations, he or she must be paid a salary equivalent to twice the state’s minimum wage, based upon a 40-hour workweek AND the nature of the employee’s work must be such that it meets one of several tests established for overtime exemptions by the California Industrial Welfare Commission.

Generally speaking, for an employee to be exempt from overtime in California, he or she must perform certain types of work deemed by the state to make the employee exempt from overtime compensation.

If the employee’s job duties do not meet the requirements set forth by California law, then regardless of how much the employee earns per year, he or she will not be exempt from overtime pay requirements.

The Labor Law Helpline is a service to California Chamber of Commerce preferred and executive members. For expert explanations of labor laws and Cal/OSHA regulations, not legal counsel for specific situations, call (800) 348-2262 or submit your question at

Staff Contact: David Leporiere

David Leporiere
David Leporiere
David Leporiere joined the CalChamber in 2014 and currently serves as an HR adviser. Specializing in employment and labor law on behalf of businesses and business owners, he also has provided training for employers on a wide variety of employment-related topics, including discrimination, harassment, wage and hour, and leave laws and regulations. He holds a J.D. from the University of California, Davis.

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