June 11, 2020
- Keep Accurate Records. Where an employer fails to maintain accurate payroll records, employees carry their burden when they show that they performed work for which they were improperly compensated and produce some evidence to show the amount and extent of that work “as a matter of just and reasonable inference.” Anderson, 328 U.S. at 687; see also Brock v. Seto, 790 F.2d 1446, 1448 (9th Cir.1986); McLaughlin v. Seto, 850 F.2d 586, 589 (9th Cir.1988).
- Pay Properly. Paying a “salary” to nonexempt employees to avoid paying overtime often results in substantial liability to the employer. There are three main types of exempt employees under California law: executive, professional and administrative. The pertinent wage orders set forth the requirements for each.
- Classify Properly. Hiring workers as “independent contractors” to do regular work. Over the past several years, this issue continues to be hotly litigated in many state and federal courts up and down the state of California, including many class actions (FedEx, UPS, SuperShuttle and Uber, to name a few). Under the state and federal law, workers are presumed to be employees unless the employer can prove otherwise
- Have Proper Wage Statements. Such statements must include: 1) gross wages earned; 2) total hours worked (non exempt employees only); 3) piece-rate units and rate if applicable; 4) all deductions; 5) net wages earned; 6) pay period; 7) employee’s name and last four digits of SSN or employee I.D. number; 8) name and address of legal entity that is the employer; 9) applicable hourly rates and corresponding hours at each rate; 10) As of July 1, 2015, notice of the amount of available paid sick leave or in lieu of PTO time (Labor Code 246(h) provides such notice may be provided separately or as part of wage statement). Violation could cost the employer $250 per employee per payday, up to a cap of $4,000 per employee, plus penalties, fees, and reasonable attorney fees (Labor Code § 226(e)).
- Fire Properly. Willful failure to pay final wages immediately on the last day worked following termination or within 72 hours of quitting or resigning without notice can result in up to 30 days (six weeks) of wages as a “waiting time” penalty. (Labor Code §§ 201, 202(a), 203). Final wages includes all amounts owed to the employee, such as earned wages, vacation pay and other items as well.