Wage and Hour Laws in California

In addition to federal statutes, California wage and hour laws regulate a number of aspects of the employment relationship and pay-related issues. From the minimum wage that employers are required to pay their workers to the accumulation of paid sick leave and other types of leave, the statutory framework of the California Labor Code sets forth strict requirements for the payment of wages, including when they are due and how they are calculated.

Wage and hour laws in California also specify the benefits that accrue to workers that affect the hours they work and the wages due to them for working those hours. The interplay between some of these laws can be confusing, so it's important to understand which laws apply under specific circumstances.

Minimum wages in the U.S. are established initially by federal law. The Fair Labor Standards Act set the federal minimum wage at $7.25 per hour as of 2019. States and the various local government bodies may either adopt the federal minimum wage or set their own rates, applicable only within their jurisdictions. If more than one minimum wage law applies, employers must pay their workers the higher rate.

California Labor Code Section 1182.12 establishes the current state minimum wage rate as well as anticipated increases in future years. As of 2019, the minimum wage rate for employers with 26 or more employees is $12.00 per hour. For employers with fewer than 26 employees, the minimum wage rate is $11.00.

Both rates are scheduled to increase by one dollar an hour for each calendar year through 2022. The law also orders the state's director of finance to adjust the minimum wage annually and provides a formula by which the director must make that adjustment.

Unless an exemption applies, a California worker may not be required by the employer to work more than eight hours per workday or more than 40 hours in a workweek without being compensated for overtime.

The rate for overtime pay is either one-and-a-half times the regular rate of pay for that employee, or double the regular rate, depending on the circumstances. Where the employee works over eight hours and up to 12 hours in a workday, the employee is paid at the time and a half rate for those hours. That rate also applies to the first eight hours worked on the seventh consecutive day of work.

For hours worked over those limits – that is, over 12 hours in a day and over eight hours on the seventh consecutive day – the employee is entitled to compensation at twice the regular rate of pay for those hours.

Some types of workers are exempt from these provisions. This means that the overtime rules do not apply to those workers, and their employers may choose not to pay them at higher overtime rates.

California overtime laws also contain a number of exemptions, which means employees in those specific categories may be required to work overtime without being entitled to the statutory overtime pay rates. Additionally, the law includes certain exceptions or special rules. For those employees who fall within those special rules, overtime pay may still be due, just calculated on a different basis.

California Labor Code Section 512 requires employers to provide their employees with at least a 30-minute meal break after working over five consecutive hours for most industries. Motion picture industry workers are entitled to a 30-minute break after working six or more hours, as long as they are not working under a collective bargaining agreement. Unionized film workers are entitled to breaks as specified in the negotiated agreement.

The California meal break statute requires employers to ensure that meal breaks provide the worker with a complete break from work. In other words, the employee must be relieved of all job duties and allowed to leave the workspace premises. The employer may be allowed to require an “on duty” meal break if there is a clear, written agreement between the employer and worker to the contrary and the nature of the job means that employees can’t be relieved of duty as a practical matter.

Employers may also be required to provide ten-minute paid rest breaks in the middle of each four-hour work period. Additionally, all employers must offer reasonable break period to allow employees the opportunity to breastfeed or express breast milk for their babies. Where possible, the lactation break period should run concurrently with other break periods granted to the worker.

Along with nine other states and the District of Columbia, California requires employers to offer paid time off for medical reasons to all eligible workers. The Healthy Workplaces Healthy Families Act of 2014 (HWHF) mandates the accrual of sick leave with pay for most employees throughout the state.

Under the HWHF Act, anyone who works at least 30 days within a 12-month period for the same employer must be permitted to accrue paid time off for sick leave at the rate of at least one hour for every 30 hours worked, or at least three days of leave each year. Eligible employees include both full-time and part-time workers, as well as temporary employees, assuming they meet the 30-day provision.

Any worker with accrued sick leave can take that time to recover from illness or injury, pursue medical care or treatment, or seek diagnosis or specialist care, either for themselves or for a family member. Family members include children, (including foster and adopted children); spouses and registered domestic partners; parents; siblings; grandchildren and grandparents.

In addition to disability insurance, California has enacted several laws that can assist employees in need of time off for medical or family care. The California Family Rights Act (CFRA) entitles eligible employees to take up to 12 weeks of leave during a 12-month period for specified purposes:

• The birth or adoption of a child.
• The placement of a child with the worker's family through the foster care system.
• The care of a member of the worker's immediate family due to a serious health condition. 
• The employee's inability to work due to a serious health condition. 

The CFRA defines immediate family to include a spouse, a child or a parent. The health condition can include acute, chronic or long-term illness or injury, as well as reconstructive dental or plastic surgery following an injury, illness or accident. The required leave may also relate to incapacity as well as treatment. While pregnancy is not covered as a serious health condition by the CFRA, pregnant employees are eligible for pregnancy disability leave, or PDL, for a total of 16 weeks.

Read More: California Labor Laws

In addition, California's Paid Family Leave (PFL) program, also called the Family Temporary Disability Insurance or FTDI program, provides compensation for lost wages due to an employee's exercise of family care leave. Employees are entitled to receive a percentage of regular pay for up to six weeks. The PFL must be taken simultaneously with FMLA and CFRA leaves.

To be eligible for benefits under the PFL program, a worker must have earned $300 or more in wages subject to deductions for the State Disability Insurance program during the 12-month period. Workers must file a completed claim form through the program's online portal or via U.S. mail, along with proof of relationship in the event of a bonding claim – leave based on the birth, adoption or placement of a child – or a physician's certification of the need for medical care.

As with most states, California requires all employers to carry workers’ compensation insurance to cover the costs associated with illnesses and injuries their employees might sustain while working.

Workers’ compensation laws do not themselves require employers to provide leave, paid or unpaid, in the event of the employee’s illness or injury. However, the legal obligation to maintain insurance effectively enables workers to recuperate from on-the-job health issues and receive compensation from the insurance company on behalf of the employer.

Under the workers’ compensation system, employees may file claims for job-related injuries and sickness. Employees are eligible for various benefits under this system, including:

• Competent medical care for the injury or illness.
• Payment of lost wages.
• In cases of permanent loss of function of a specific part of the body, compensation for that loss.
• Access to job retraining services.

Outside the paid sick leave laws, no California law requires employers to offer general-purpose paid time off to their workers. Most companies, of course, do elect to provide some type of vacation leave or paid time off benefits. For companies that make that choice, California laws impose certain restrictions.

For example, companies must permit their employees to accumulate paid time off hours or days. The employer cannot refuse to accept paid time off, no matter how long ago it may have accrued, as vacation time never expires in California. A company policy that purports to require workers to use their time or forfeit it within a certain time period is not permitted.

Furthermore, California companies must treat accrued and earned vacation time as if they were wages due to the employee. In other words, the employee has an absolute right to that time or its cash equivalent at the employee’s rate of pay. An employer may not discount, deduct or withhold from that time or amount. When that employment relationship ends, whether by firing or resignation, the worker is entitled to cash out the accumulated leave.

Federal laws, such as the Fair Labor Standards Act, do not require employers to offer paid time off for reasons such as jury duty. This means that it’s up to individual states to determine whether employers must pay workers for jury duty days and if so, at what rate of pay.

While eight states do require employers to offer paid days off to workers serving on juries, California is not one of those states. California is also not one of the 15 states that forbid employers from requiring workers to take accumulated paid time off for jury duty, although employees may do so if they wish. Employers may not under any circumstances take retaliatory actions against employees who are absent from work in order to fulfill jury duty obligations.

By way of contrast, the California election code states that employers must give employees enough time off from work to cast a vote in any election, although they are only required to pay for up to two hours of the time the employee is absent. The employee must take this time either before the regular shift starts, or after it ends, and must give their supervisor at least three days’ notice of their intent to take voting leave.