| One of the most common and often expensive | | | | that have not yet received their licensing from |
| mistakes an employer can make is to misclassify | | | | the state. |
| their employees as being exempt from overtime, | | | | The most frequently used defense by employers |
| if they are, in fact, non exempt employees by | | | | is that their employee can be classified exempt |
| law. Exempt employees are often referred to as | | | | under the California executive exemption. |
| salaried employees and in very basic terms it | | | | Although, it is actually the hardest exemption to |
| means that the employee is therefore is not | | | | qualify for because it requires that the employee |
| eligible for overtime. California labor law addresses | | | | perform ALL of a long list of criteria named in the |
| what criteria are necessary in order to classify | | | | labor law, not just some. To be more specific, the |
| employees properly. This law relates specifically to | | | | California executive exemption requires that the |
| the California administrative exemption, the | | | | exempt employee have the ability to hire or fire |
| California professional exemption, the California | | | | other employees or at least have a highly valued |
| executive exemption, and the California outside | | | | opinion in this matter. It also requires that the |
| sales exemption. “California” is stressed | | | | employee directly manages the work of two or |
| because the federal labor laws are slightly | | | | more employees or the equivalent of 80 hours a |
| different than those of the state of California. As | | | | week. This exempt employee must be in charge |
| an employer or employee it is wise to educate | | | | of the entire department or unit they are |
| yourself on your state’s employment laws or | | | | managing and regularly exercise discretion and |
| the consequences could be costly. | | | | independent judgment on the job. This employee |
| It’s also important to note that in California, | | | | must also be paid a salary of twice the California |
| whenever a labor law dispute is brought to court, | | | | minimum wage. |
| the burden of proof is on the employer. This | | | | The California outside sales exemption differs |
| means it is the employer’s responsibility to | | | | slightly from federal law in that California does not |
| prove that they are not guilty of the violations | | | | regard “exempt work” duties incidental to |
| they are accused of committing. Lastly, and most | | | | the employee's sales or solicitations, including |
| importantly, for the most part, the actual job | | | | incidental deliveries and collections. This difference |
| duties that an employee performs determine | | | | in law is significant for route salespeople and |
| whether or not they are exempt, not the job title | | | | others who perform many other functions in an |
| given to them. | | | | average day, such as delivery, repair, and |
| The California administrative exemption statute | | | | maintenance. California outside sales exemption |
| states that in order for an employee to be | | | | applies to an adult worker that spends over half |
| classified as exempt the employee must perform | | | | his or her time away from the employer’s |
| office work or non manual work that is directly | | | | place of business selling or taking orders for an |
| related to policy shaping or business operations. | | | | actual product or service. The final area that is |
| This means that the employee must have the | | | | different about the California outside sales |
| power to issue and enforce company policy. It | | | | exemption from the other California exemption |
| does not necessarily apply to workers that are | | | | laws is that is does not require that the salary be |
| allowed to exercise discretion in their daily job | | | | “twice the minimum wage amount”. Often |
| function, within the parameters or guidelines of | | | | times these jobs have opportunity for |
| existing company policy. This can be confusing, | | | | commissions or bonuses. |
| but a very generic example of California | | | | With such specific regulations to comply with, it is |
| administrative exemption may be helpful. A non | | | | extremely important that as an employer or as |
| exempt employee does not have the authority to | | | | an employee you are well aware of how to |
| create new rules that other company employees | | | | classify yourself or others. Under California law, |
| must follow, but an exempt employee would | | | | the employee has up to four years to file a |
| have this authority. | | | | lawsuit to claim any wages that were not paid as |
| The California professional exemption most | | | | a result of being misclassified as exempt from |
| commonly refers to professional occupations that | | | | overtime. Additionally, if the court finds that the |
| require a California state license, such as dentistry, | | | | employer knowingly and intentionally misclassified |
| engineering, optometry, law, medicine, | | | | the employee, the financial ramifications can be |
| architecture, teaching, or accounting. However, | | | | exceedingly detrimental. As an employee if you |
| nurses and pharmacists are rarely included as | | | | suspect you have been misclassified, you may |
| exempt under the California professional | | | | want to contact the California Labor Board or a |
| exemption law. The most common mistake | | | | California labor law attorney to help you claim the |
| among employers is to misclassify employees | | | | money that is owed to you. |