California workers may assume that if they are paid a salary, as opposed to an hourly rate, they are an exempt employee. Exempt employees do not get paid for overtime and are not entitled to the same break periods as hourly employees.
However, earning a salary does not automatically mean you are an exempt employee. There are many situations where salaried employees must still be paid overtime and receive break periods.
Misclassifying employees is illegal
Classifying an employee as exempt when they should be non-exempt is illegal under California law. Sometimes employers make an honest mistake and misclassify an employee unintentionally, but sometimes employers knowingly misclassify an employee to avoid having to pay overtime, assuming the employee won’t find out.
There are several factors to consider when determining if you are an exempt or non-exempt employee. First, job duties, and not a job title, factor into your classification status. You may have a “management sounding” job title and be paid a yearly salary, but if the work you perform is the same as workers paid by the hour, you may not be an exempt employee.
Next, your job duties must meet a “strict duties test.” This test involves a careful assessment of exactly what you do, and how much of it. If more than 50% of your job duties do not qualify as exempt duties, you are likely a non-exempt employee and entitled to overtime.
Exempt v. non-exempt job duties
Whether your job duties are considered exempt depends on various factors set out by the California Labor Commissioner. These factors include how much of a salary you earn and if you are allowed to exercise discretion and independent judgment when performing your job duties. Employees whose primary duties are following the directions of someone else and who do not have a choice in how their job duties are performed are typically non-exempt employees.
Employment attorneys know that each situation requires a thorough analysis to determine the correct job classification. If you have questions or concerns about your job classification, they can provide answers and guidance on any next steps. Compensation may be available in the form of backpay.