Review of Employment Procedures

It is time that all employers to immediately review all of their employment procedures (including employee handbooks and employment agreements) to make sure that wage an hour reporting is in compliance with the law. Failure to do so, can result in hundreds of thousands of dollars being assessed against the employer, for failure to pay wages correctly.  Every employer needs to make sure that employees are receiving proper compensation, that employees are receiving both their meals and rest breaks, and that proper reports are provided to employees concerning their payroll records.

California is one of the most difficult states for employers to do business in. The law in California is unforgiving and the penalties are high for failure to properly pay employees. In California, employees must receive a rest break of 10 minutes for the initial 4 hours of work that is done, which must be compensated for, they then must receive at least a 30-minute meal break (which can be uncompensated), if the employee is going to work 300 minutes, which is five hours. If an unexempt employee does not receive a 30-minute meal break, which can be unpaid, (generally with only one exception), before they work 301 minutes, the employer is responsible for paying an extra hour of compensation. This is not overtime, but a meal break penalty. This same penalty applies if the employee does not get the paid rest break for the 10 minutes. If the employee is going to work less than six hours, and has signed a waiver, they can wave the meal break, but the moment the employee works 361 minutes, which is six hours and 1 minute, that employee is entitled to the one-hour penalty. There is no exception to this rule, even if the employee chooses not to take their meal break, the employer is still responsible for payment of the penalty.

Employers must put procedures in place to avoid these penalties. In addition, if you have an employee that is not paid everything, they are owed by the time that they receive their final check upon their termination, including unpaid break penalties, the employee may be entitled to receive up to 30 days, not for weeks but 30 days of compensation as a penalty. There are other penalties such as wage and hour statements not being correct, which has $100 penalty for each statement.

There are things that can be done to protect a business from being liable, we encourage every employer to consult with an attorney, they have their handbook reviewed, and to discuss the options to protect themselves. A simple example would be to make lunch breaks being 45 minutes instead of just 30 minutes. This would avoid owing an employee who clocks out for lunch clocks back in after only 29 minutes, which results in a penalty. There is also the need to understand the difference between an hourly employee who is not exempt, as compared to a salaried employee, who is exempt. Just because an employee is paid a salary does not make them an exempt employee, and this needs to be discussed with somebody who understands the law.