California minimum wage laws require employers to pay non-exempt employees for all hours worked. Hours worked, as defined by the Industrial Welfare Commission, includes all time an employee is subject to the employer’s control and all time the employee is suffered or permitted to work, regardless of whether the employee is required to work or not. IWC Orders 1-16: Section 2(G); CA Division of Labor Standards Enforcement Policies and Interpretation Manual 46.1.
An employer must count all hours worked no matter where the work is performed. For example, hours worked may occur on the employer’s premises, at a designated worksite, or at other locations such as at home.
California minimum wage laws define a workweek as any seven consecutive 24-hour periods (168 consecutive hours) that begin with the same calendar day each week. The typical workweek schedule begins each Sunday and ends the following Saturday, however, this need not be the case. The workweek may begin on any day of the week. CA Labor Code, Section 500(b)
California “Regular Rate of Pay”
Section 226.7 of the Labor Code requires employers to pay an additional one hour of pay at the employee’s “regular rate of compensation” for each workday that the meal or rest or recovery period is not provided (known as a “premium” payment).
California minimum wage laws require employers to count waiting time as hours worked for minimum wage and overtime purposes if the employees are restricted and unable to effectively use the time to engage in personal pursuits.
The fact that the employees may not perform any actual work other than waiting does not by itself permit an employer to exclude the waiting time from its hours worked calculation. CA DLSE Enforcement Policies and Interpretations Manual 46.1.2(fn 4), 46.2
When determining whether an employer must pay an employee for on-call or standby time, California labor law considers whether the on-call time or standby is spent primarily for the benefit of the employer as opposed to the employee. CA DLSE Enforcement Policies and Interpretations Manual 46.1.2 Courts have considered the following factors when determining whether an employer must pay an employee for on-call or standby time:
- the employee is required to live an on-premises
- the geographic extent to which the employer restricted the employee’s movements
- the frequency of calls
- how quickly the employee is required to respond to calls
- whether the employee could easily trade on-call responsibilities with another employee
- whether the employee’s use of a cell phone, pager or other technological device could ease geographic and time restrictions
- whether the employee is able to actually engaged in personal activities during on-call time
California considers on-call or standby time to be “controlled” when the on-call or standby time must be included by employers as hours worked for minimum wage and overtime purposes. CA DLSE Enforcement Policies and Interpretations 188.8.131.52 California considers on-call or standby time to be “uncontrolled” when an employees is completely unrestricted to use the time for their own purposes. CA DLSE Enforcement Policies and Interpretations 47.6.1
Employers are permitted to pay employees a lower wage rate for on-call time than they do for time when employees are performing actual job duties. CA DLSE Enforcement Policies and Interpretations 47.6
Employers are not required to include the uncontrolled on-call or standby time as hours worked for minimum wage or overtime purposes. If an employee pays an employee a stipend for uncontrolled on-call or standby periods, the employer must include the stipend amount when determining any overtime rate but does not need to include the uncontrolled on-call or standby periods when determining how many overtime hours the employee worked in the day or week. CA DLSE Enforcement Policies and Interpretations 47.6.2
Generally, California minimum wage laws require employers to count employee on-duty sleep time as hours worked. CA DLSE Enforcement Policies and Interpretations 46.4 However, there are exception to the general rule.
If employees work 24-hour shifts or longer, an employer and employee may agree to deduct up to and not exceeding eight (8) hours of sleep time from the employees’ hours worked for that shift, so long as the employer provides adequate sleeping facilities and the employees usually receive eight (8) hours of uninterrupted sleep.
If the employee does not provide an expressed or implied agreement to deduct sleep time, the employer must include all sleep time as hours worked for minimum wage and overtime purposes. CA DLSE Enforcement Policies and Interpretations 46.5(a) Some limitations and restrictions apply to specific industries including health care. CA DLSE Enforcement Policies and Interpretations 46.5, 46.5.1-2
If an employer and employee have agreed to deduct sleeping time, an employer must include any interruption from the sleep by a call to duty as hours worked for minimum wage and overtime purposes. Moreover, if the interruptions are so frequent or prolonged so that the employee is unable to get a reasonable sleep period, the employer must include the entire sleep period as hours worked. Typically, an employee is considered to not have had a reasonable sleep period if they are unable to receive at least 5 hours of uninterrupted sleep. CA DLSE Enforcement Policies and Interpretations 46.5(a)
California minimum wage laws require an employer to count employee travel time as hours worked whenever it requires employees to travel, no matter when the travel occurs. This includes any time employees are required to travel out of town, whether on a one-day or overnight trip. An employer is not required to pay employees for any personal time taken while traveling, such as sleep time, meal period, or sightseeing.
If an employee’s travel time to a transportation center (airport, bus station, train station, etc.) is about the same as the travel time to the employee’s usual workplace, the employer may begin counting the employee’s travel time as hours worked once he or she arrives at the transportation center. CA DLSE Enforcement Policies and Interpretations 46.1.1
Employers must also count as hours worked time spent by employees traveling from a central reporting location to their actual work location. CA DLSE Enforcement Policies and Interpretations 46.1.1 Moreover, although employers are generally not required to pay employees for time spent traveling to and from their homes before and after shifts, they may be required to pay employees for time spent traveling to and from their homes if the employees are restricted in what they can do once the shift has ended, e.g. required to drive a work vehicle immediately to their home because they are unable to use it for personal purposes. CA DLSE Enforcement Policies and Interpretations 46.1.1
Employers are permitted to pay employees a lower wage rate for travel time than they do for time when employees are performing actual job duties. The employer must notify employees they will be paid the lower wage rate before the travel begins. CA DLSE Enforcement Policies and Interpretations 46.1.1
Meeting, lecture, and training time
California minimum wage laws require employers to count time spent by employees at meetings, lectures, or training unless all four of the following criteria are met:
- attendance occurs outside regular working hours;
- attendance is voluntary;
- the meeting, lecture, or training is not directly related to the employees job; and
- the employee does not perform productive work while at the meeting, lecture, or training.
Attendance is consider to not be voluntary if employees are led to believe that their absence would lead to their termination or otherwise negatively impact their present working conditions in some other manner.
A meeting, lecture, or training is directly related to an employee’s job if it is designed to help the employee perform his or her current job duties more effectively as distinguished from preparing the employee for a new job or helping the employee learn a new skill.
Show up or reporting time
California labor law requires employers to pay non-exempt employees reporting time or show up pay, unless an exception applies. Reporting time pay covers two types of situations:
- employees who show up for a scheduled shift but are not permitted to work any time
- employees who show up for work but work less than half their scheduled shift
In each of these scenarios, the employer is required to pay the employees at their regular pay rate for at least half of the employees’ usual or scheduled day’s work, with a minimum of two (2) hours pay and a maximum of four (4) hours pay. IWC Orders 1-16: Section 5(A)
In situations where employees are required to report to work for a second time during the same workday, an employer must pay the employee for a minimum of (2) hours regardless of hour many hours the employee actually works. IWC Orders 1-16: Section 5(B)
An employer does not need to pay employees reporting or show up pay if:
- the employer’s operation cannot begin or continue due to a threat to employees or property,
- civil authorities recommend that the employer not begin or cease operations,
- public utilities do not provide electricity, water, or gas, or there is a failure of public utilities or the sewer system,
- the employer’s operation cannot begin or continue due to an Act of God or any other cause not within control of the employer, and
- the employee is on paid standby status and the employee is called to report at a time other than their scheduled reporting time.
An employer does not need to count hours compensated as show-up time but not actually worked as hours worked when calculating weekly overtime obligations.