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Wage and Hour Claims

The attorneys at Ruzicka, Wallace & Coughlin, LLP are experienced with the complexities associated with wage and hour disputes and will provide counsel and advice to employers to ensure compliance with California and federal laws, including those related to minimum wage, overtime, on-call, waiting time, and other wage payment requirements.

Interaction of Federal and State Law

A complex scheme of overlapping statutes, regulations, interpretations and precedent governs the compensation of employees in California. Federal law is codified in the Fair Labor Standards Act (FLSA) and regulations interpreting the Act. California law is codified in various provisions of the Labor Code and in Wage Orders the Industrial Welfare Commission promulgates. A significant overlap in coverage exists between the federal and state standards, but there are also some significant differences. Although state law standards are generally more protective of employees than federal standards, California employers must comply with whichever standard provides greater protection to employees.

Fair Labor Standards Act (FLSA)

The FLSA applies to employees in industries engaged in, or producing goods for, interstate commerce, unless the employer can claim an “exemption” from coverage. The U.S. Supreme Court has consistently construed the FLSA “liberally to apply to the furthest reaches consistent with congressional direction,” recognizing that “broad coverage is essential to accomplish the goal of outlawing from interstate commerce goods produced under conditions that fall below minimum standards of decency.” The most commonly litigated issues under the FLSA have historically been whether employees designated as exempt are being paid on a salaried basis and whether they fall within a statutory exemption from overtime and minimum wage laws. These cases usually arise where lower-level managers or administrative employees are designated as salaried employees (e.g., in operations such as retail stores, restaurants, insurance companies, etc.). Other frequently litigated issues include:

  • Whether employees are entitled to pay for before-and-after-shift activities and for travel time between job sites;
  • Whether employees have been misclassified as independent contractors;
  • Whether docking an employee’s pay for disciplinary reasons destroys salaried status; and
  • Whether an employer may offer compensatory time off instead of overtime.

California Wage and Hour Issues

The Labor Code and Wage Orders of the Industrial Welfare Commission set forth California law governing wages and hours. The California Industrial Welfare Commission (IWC) is the state agency empowered to formulate regulations (known as “Wage Orders”) governing minimum wages, maximum hours and overtime pay in California. Although substantially patterned after federal regulations, the IWC Wage Orders provide greater protection in certain respects than federal law provides. The IWC Wage Orders appear in Title 8 of the California Code of Regulations (8 CCR § 11000 et seq.), and can also be accessed at www.dir.ca.gov/DLSE.