Are you eligible for overtime pay?

The Obama Administration will be raising the eligibility threshold of salaried workers qualifying for overtime. Currently, salaried workers can make as little as $23,660 per year and still be exempt from overtime pay. This translates to the portion of California law which states properly classified salaried employees can make no less than twice the minimum wage (which in California is currently set at ten dollars per hour). The new rule will raise the threshold to $47,476 per year, and will take effect on December 1st 2016. This means that any salaried employee who makes less than $47,476 per year will be eligible for overtime pay when they work more than 40 hours per week. This number will also adjust every three years to keep up with the rate of inflation. The rate will be determined by calculating the worker’s hourly rate, and multiplying it by the appropriate rate factor (either 1.5 times normal rate of pay or double time). The new threshold was not chosen arbitrarily. Administration states that the number was chosen because it represents the 40th percentile of salaries in the Southeast, which is the lowest-paying region in the United States.

This change is estimated to impact about 4.2 million workers, who did not previously receive overtime pay. It will not affect non-exempt or “hourly” employees (people that were already eligible). However, critics (namely employers) are raising concerns about the new law, questioning whether or not this will actually benefit workers or will a negative outcome. The opposition to the rule are citing such possible outcomes as salaried employees being re-classified as hourly, base wages being lowered in order to compensate for overtime pay, or mass layoffs. Truthfully, there are an equal number of positive outcomes despite these hypotheses.

Employers will have a few options when it comes to making adjustments to wages or work hours:

  • They can raise base wages above $47,476 annually if they truly wish to avoid paying overtime, which would make a large difference in the compensation for underpaid salaried employees.
  • They can enact protocol changes to make sure their employees do not work more than 40 hours per week, which would in turn give the employee more free time for leisure, family, and health benefits. This would also encourage job creation, as employers will need to fill the excess hours previously worked by the exempt employees.
  • They can keep base wages where they are but pay employees overtime when necessary, which most likely would still be a welcomed change in the eyes of the eligible salaried employees.

Logically, employers will not want to make changes that would hurt their employees. Morale comes into question when employees realize they are being treated poorly and are not valued by the company they work for. Employers will not be required to convert their salaried employees to hourly if they do not meet the threshold, and while it may seem more convenient to do so, in reality it wouldn’t be. Realizing that employees will not want to feel “demoted” simply because they are being compensated fairly, it would be a far more efficient (and more likely) move for employers to track the hours being worked. This wouldn’t be difficult change to make, seeing as how a majority of companies already utilize some form of electronic tracking for hours worked or projects being completed. This information can easily be sent via laptops or mobile devices when employees are not in the office or otherwise completing “overtime” work.

A final thought to consider, is just how rampant employment status misclassification is in today’s workforce. People are often misclassified as salaried employees or independent contractors when they should in fact be W-2 or hourly employees. Perhaps, if employers do make the decision to re-classify some of their employees, this change will bring justice to those who have been working long arduous hours without the proper overtime compensation.

If you you are owing overtime pay and have a difficult time getting paid for overtime, please consult with one of our attorneys at Aegis Law Firm, Irvine, CA. For more information contact us HERE

Read our previous blog post on unpaid overtime HERE

Where Commissioned Employees Fit in to California’s Overtime Law Requirements

 

In California, an employer is required to pay its employees overtime if the employee works in excess of eight hours a day or more than forty (40) hours a week. Overtime is compensated at the rate of no less than one and one-half times (1 ½) the regular rate of pay for an employee. However, there are certain employees whom are exempt from this general overtime requirement, depending on their profession and/or compensation structure. One these exemptions apply to employees whose compensation is based upon commissions. The Industrial Welfare Commission Wage Orders provide that, “employees (except minors) whose earnings: (1) exceed one and one-half times the minimum wage; and (2) more than half of their compensation represents commissions,” are exempt from the general overtime provision. This is the California Overtime Law.

As such, it is important to note that just because an employee earns some commissions, the exemption does not automatically apply. The exemption only applies to the employee if both prongs are met.

A relatively recent and important case that touched upon this issue was the case of Peabody v. Time Warner Cable, Inc., 59 Cal.4th 662, 663 (2014) (“Peabody”) which resulted in a published 2014 decision by the California Supreme Court. There, Ms. Peabody, the employee who worked for Time Warner Cable, Inc. (“Time Warner”), received paychecks that encompassed both hourly wages and commission wages. After leaving her employment with Time Warner, she sued for overtime wages, among things, based upon the claim that she regularly worked 45 hours per week and occasionally 48 hours per week. Although Time Warner did not dispute the fact that Ms. Peabody worked 45 hours per week and was paid no overtime, it argued that she fell within California’s “commissioned employee” exemption and thus was not entitled to overtime compensation. At the time of the lawsuit, the minimum wage in California was $8.00 per hour. As such, in order for the “commissioned employee” exemption to apply, Ms. Peabody’s compensation must have amounted to no less than $12.00 per hour. Time Warner reasoned that even though most of Ms. Peabody’s checks included only hourly wages and were for less than $12.00 per hour based upon the hours she worked, the commissions should be attributed to the “monthly pay period for which they were earned,” and that attributing the commission wages in this manner would satisfy the exemption’s minimum earnings prong. The district court bought this argument and dismissed the case. Upon appeal, the Ninth Circuit struggled with the issue of whether the employee’s commissions must only be counted toward the pay period in which the commissions were paid or where they can be allocated over the course of a month.” Due to the absence of controlling precedent, the Court of Appeal affirmed the district court’s ruling with respect to the overtime claims.

The California Supreme Court ultimately held, however, that Time Warner cannot attribute wages paid in one pay period to a prior pay period to cure a shortfall with respect to the minimum earnings prong and whether the minimum earnings prong is satisfied depends on the amount of wage actually paid in a pay period. This decision was definitely a win for commissioned employees as it serves to deter employers from deferring the payout of commissions to weeks or months later in order to satisfy the minimum earnings prong — a practice that is relatively common amongst California employers.

Based on the above, employees whom are not receiving overtime compensation and whose earnings are entirely commissioned-based, or is comprised of both commissions and hourly wages, need to be wary of how much they are being paid in light of the number of hours they are actually working to ensure that their compensation for each pay period meets the minimum earnings prong. If you suspect that your employer is improperly relying on this “commissioned employee” exemption to avoid paying you overtime compensation, contact an attorney immediately to discuss your rights.

For more information on California Overtime Law and your personal situation involving unpaid overtime, make an appointment with one of our attorneys at http://aegislawfirm.com/contact/ or call and ask for Kashif or Sam at (949) 379-6250.

Reverse Racism – Racial Discrimination at Work

As the world we live in becomes more and more politically correct, the boundaries of “correctness” are often questioned and challenged. One such topic around the notion of racial discrimination which has been debated, is whether or not “reverse racism” exists. Can a white person really be discriminated against due to their skin color? A lawsuit recently filed against the Getty Center (also known as the J Paul Getty Museum) alleges just that. Samantha Neimann is an undergraduate student at Southern Utah University who states she was “deterred from applying” to the Getty Center’s Multicultural Internship program – due to the fact she is white. Neimann is of German, Irish, and Italian descent, however, these ethnicities do not satisfy the program’s requirements. The program stipulates that in order to be eligible, a student must be a “member of groups traditionally underrepresented in the staffs of museums and visual arts organizations….those of African-American, Asian, Latino/Hispanic, Native American, and Pacific Islander descent.”

Neimann’s lawsuit asserts that she was well qualified for the internship, boasting a 3.7 GPA, but was not considered for the internship based solely on her ethnicity. The lawsuit also alleges she was “harassed, discriminated, and retaliated against”, though the circumstances surrounding the other charges were not elaborated upon. She is seeking compensatory damages for lost wages (the program allots interns a $4,500 stipend for 10 weeks of participation), “including, but not limited to loss of earnings and future earning capacity, medical and related expenses for care and procedures both now and in the future, attorney’s fees, and other pecuniary loss not presently ascertained.”

Ron Hartwig, the vice president of communications for the J. Paul Getty Trust has stated that within recent months, the internship program has been opened up to white applicants. This comes after several inquiries from potential applicants, though the purpose of this specific program is to increase diversity in the arts. Created in 1993, the program has supported over 3,000 internships at 152 organizations throughout the country. In the past, at least one white student was accepted in 2006, which may pose a problem for Neimann’s case. Additionally, it should be known that the Getty Center does not manage all of the applications, as students apply for internships directly with the foundation they wish to work for.
This all begs the question – is this “reverse racism”? Does such a phenomenon even exist, or is it all just…well, plain old racism? Though they aren’t as common, cases have been filed and won with white plaintiffs alleging workplace discrimination.

In 2014, a civil lawsuit was filed against Prince George’s County school board by Jon Everhart, a white teacher who stated he was targeted and discriminated against due to his ethnicity. The harassment started in 2003 when the future principal (at the time, she was a physical education teacher) made racially insensitive comments to students such as, “The only reason a white man teaches in P.G. County is that they can’t get a job elsewhere.” Similar comments were made directly to Everhart including calling him “white bitch” and “poor white trash”. The discrimination ultimately resulted in Everhart’s termination which also caused his teaching license to be revoked. In the end, Everhart was awarded $350,000 for the ordeal.

Also in 2014, a white police officer from New York by the name of Christopher Barrella was awarded $1.35mil following his discrimination lawsuit. He stated that his mayoral boss, Andrew Hardwick, passed him over in consideration of the upcoming position for police chief. Instead, a Hispanic officer was given the position though he was technically far less qualified. Mr. Barrella boasted a law degree, master’s degree in public administration, special training at an FBI academy, and other accolades. The officer chosen for the position had only a high school diploma, and received a third place finish on his civil service exam while Mr. Barrella received the top score.

It goes without saying that regardless of the race or ethnicities involved, racism in any venue is not acceptable or tolerated in today’s society. Contact the author of this article at Aegis Law Firm, based in Irvine California for further information on how to defend yourself legally should you be facing racial discrimination at your workplace.

Sexual Harassment

Sexual Harassment in the Workplace: How You Can Protect Yourself

We’ve all had that co-worker. Perhaps they make “jokes” that are just a bit too personal. Maybe they don’t get the hint when you reject their dinner invitation (for the 3rd time). Or maybe they even get a little too touchy with their hugs and shoulder massages. But it’s nothing to cause a scene over, right?

Not necessarily.

Cosmopolitan magazine recently conducted a survey of 2,235 women, and the results were disheartening. According to the study, 1 in 3 women face sexual harassment in the workplace. That’s not to say that men never face sexual harassment in the workplace, but this particular survey focused on the statistics surrounding females.

So how can you tell if you’re being sexually harassed, and what can you do about it?

  1. Sexual harassment can be more than just unwanted touching

Of the women surveyed, 84% stated they experienced sexual harassment verbally. Many people are unaware that this falls under the category of sexual harassment! Other forms of sexual harassment may include lewd/inappropriate texts & emails, jokes/comments about your body or a specific gender, and of course unconsented physical contact. Additionally, many people do not know that sexual harassment can occur without the motive being sexual in nature. For example, a heterosexual male can still experience sexual harassment from another heterosexual male. Sexual harassment in the workplace need not come from someone of opposite gender or sexual orientation.

  1. Taking action is not only critical, but your right!

71% of the women who experienced sexual harassment in the workplace did not report it. Some reasons people may not report their experiences are because

  • They don’t realize they are being harassed
  • They are afraid of repercussions from the attacker
  • They are afraid of repercussions from the employer

However, in California sexual harassment in the workplace complaints fall under a special category of protected circumstances which cannot be used as grounds for termination. Retaliation in regards to reporting a perceived illegal activity (whether it turns out to actually be illegal or not) would also be unlawful.

Often, employers will first ask if you have explicitly told the harasser “no” (using that exact word or an equivalent phrase), or expressed to the harasser that their behavior is making you uncomfortable before upper management will get involved (depending on the severity of the situation). The expectation for you to be responsible for ending the problem can be nerve wracking of course, because you probably don’t want to make things even more awkward with the co-worker in question. However, it is important to protect your right to a comfortable & safe work environment, and simply saying “no” may be the first step. If you have already told your harasser how you feel, or you do not feel appropriate action has been taken by your employers to ensure your safety, it may be the right move to follow up with HR.

  1. Document all incidents and get things in writing when you can

If you feel that you are being subjected to sexual harassment in the workplace, it is imperative to document as many details as possible about the incidents. Be sure to include dates, times, names of people involved, etc. Additionally, be sure to save all emails or texts messages which may include important details of the situation – whether from the harasser themselves, or you discussing the situation with another person. This will help further down the line if you decide to pursue a sexual harassment lawsuit or when speaking to management about your concern. The more thorough you are, the more “legitimate” your claims will appear to be.

  1. If the situation becomes threatening, contact the local authorities as soon as possible

A co-worker should never threaten your life, stalk you, or even allude to harming you. If their actions reach this level and you feel your safety may be in serious danger, please contact your neighborhood police.

Sexual harassment in the workplace is totally unacceptable. Find out what your options are to fight it legally at aegislawfirm.com

San Francisco Passes the Paid Parental Leave Ordinance

California is leading the way when it comes to worker’s rights. In addition to passing the new minimum wage hike, San Francisco became the first city in the United States to approve paid parental leave for new parents. That includes same sex couples, and anyone who either bears or adopts a child.

On April 12, 2016, the San Francisco Board of Supervisors passed an ordinance that will provide six weeks of parental leave to bond with a new child at 100% of the employee’s rate of pay. While California already provides for six weeks of parental leave through its Paid Family Leave (“PFL”) program, this program only paid up to 55% of the covered employee’s rate of pay. San Francisco’s new ordinance will require covered employers to contribute the remaining 45% of the employee’s wages while that employee is on leave so that the employee receives his or her full pay (up to a total of $2,053 per week). In order to comply, employers must pay a supplemental compensation that will cover the remaining amount between how much the state is paying and the employee’s regular weekly compensation. In order to calculate the regular weekly compensation amount under the PFL employers need to divide the state’s weekly benefit figure by the percentage rate of the wages being replaced by the PFL program.

The new San Francisco ordinance will go into effect for employers with 50 or more employees (regardless of where the employees are located) on January 1, 2017. Employers with 35 or more employees and 20 or more employees will see the ordinance go into effect July 1, 2017 and January 1, 2018, respectively. Employers must post a notice explaining the paid parental leave program in a conspicuous place in any and all languages that at least 5% of the languages spoken by the workforce at the workplace.

For an employee to be eligible under the new ordinance, the employee must: (1) be employed for at least 180 days prior to the start of the leave; (2) work at least 8 hours per week in San Francisco; (3) work at least 40% of their weekly hours in San Francisco; and (4) be eligible for California Paid Family Leave for baby bonding.

Under the new program, employers may require their employees to use up to two weeks of vacation before supplemental compensation must be paid. If an employee refuses to do so, the employer may be relieved of its obligation to provide supplemental compensation to that employee.

Although this new ordinance is only applicable to San Francisco employees, California Paid Family Leave is available to any eligible employee in the state. (To find out if you’re eligible for California Paid Family Leave, contact the California Employment Development Department.)

While an employee’s job is not protected while out on leave under either the San Francisco ordinance or the California Paid Family Leave program, an employee may also be eligible for job-protected leave through the federal Family and Medical Leave Act (“FMLA”), the California Family Rights Act (“CFRA”), or the Pregnancy Disability Leave (“PDL”) law.

The governmental office designated to enforce compliance of the paid parental leave program is the San Francisco Office of Labor Standards Enforcement (OLSE). The OLSE has the authority to not only enforce the program but has the ability to order any other appropriate relied including monetary penalties. Penalties may be the greater of $250 or three times the amount withheld. The OLSE can also levy a penalty of $50 per day to each employee.

Additionally, while the employee’s job may not be protected, an employer may not discriminate or retaliate against, or take an adverse employment action against an employee for exercising his or her rights under these laws. If you feel that you have been denied the right to take Paid Family Leave, or had an employer retaliate or discriminate against you, or terminate you for exercising your rights to take such leave, it would be in your best interest to contact Aegis Law Firm at (949) 379-6250 immediately so an attorney may review your case and advise you on your options.