Non-residents of California are Hoping for Overtime Pay
The nation has been anxiously awaiting the California Supreme Court opinion of California’s employment laws regarding non-resident employees who perform work in California. The decision will likely force many employers to reevaluate their non-exempt payment policies, specifically overtime. Presumably, a large number of lawsuits will follow, including class actions, demanding back pay of overtime.
Sullivan v. Oracle has been settled and appealed several times. The premise of the case was that several Arizona and Colorado residents were employed by Oracle as instructors; they argued that they were entitled to overtime under California law when they had preformed work in California. However, Oracle had classified the instructors as exempt employees and as such they were not paid overtime. This case required the interpretation of two labor laws principals; first whether or not the nonresidents were covered under California labor laws and second if they were classified properly as exempt employees. The federal Ninth Circuit Court of Appeal certified these issues for the California State Supreme Court to decide.
Most companies in California are aware that California law has several striking differences from the federal Fair Labor Standards Act (“FLSA”). Specifically, exemptions from overtime under California labor law are examined differently than under the FLSA; focusing on not what an individual’s “primary” duties are, but on the duties in which they are “primarily” engaged. Furthermore, California labor law requires that overtime be paid at time and half for hours 8-12 in a day and for double time for work performed beyond 12 hours in a day. Meal and rest breaks to non-exempt employees are also a requirement under California labor laws.
The California Supreme Court found that California’s overtime laws do apply to non-resident employees who perform work in California. The Court went a step further to conclude that the state overtime laws did not make a distinction between residents and non-residents, and clarified that it would defeat the purpose of those laws if employers could simply “import unprotected workers from other states.”
While the decision is limited to “California-based” employers; the court did not provide a definition for this term. As such, employers based outside California should not ignore Sullivan. There is every reason to believe that non-resident workers of employers based outside California will contend that they, too, should be covered by California’s wage-hour laws when working in the state. And, based on the broad language in Sullivan, there is every reason to believe the California Supreme Court might agree.
What Employee Should Do now when traveling to California to work
• Keep accurate records of your work hours and all breaks.
• Make a list of all the job duties you are expected to perform while in California.
• Keep accurate records of your travel time and all travel expenses, including mileage.
If you are not paid for all hours worked or have been classified as exempt from overtime, contact an experienced California labor law attorney to examine your records. You might be owed back pay for your overtime, meal and rest breaks as well as travel time and expenses.
Photo Credit: Shutterstock/Africa Studio