California Employment Law
California Employment Law Questions Answered by Legal Experts
And I also would like to know if the efficient bonus plan was legal before 2013 in California? please advise
Thank you for your reply, Song. It is my pleasure to assist you further.The amendment to Labor Code 515 that prohibits flat rate pay agreements taking into account overtime did not go into effect until 2013, but it was the legislature's reaction to the Arechiga v. Dolores Press case from two years prior. In other words, courts were applying the same reasoning two years before actual amendment of the law, and so it is reasonable to assume courts would have reached the same conclusions regarding the legality of your proposed compensation structure since 2011.Again, please feel free to let me know if you have any further concerns. Have a wonderful evening.
Thank you for your prompt answer.
We also plan to set pcs rate for our production employee inside the pant and outside field, please advise how do we do to exemption from overtime pay.
Song,Thank you again. Since this is a separate question, site rules require it to be asked separately in a new question thread, but I am happy to provide a brief answer here.If by "pcs rate" you mean "piece rate," (as in, a specific amount of money for each unit produced or action performed), there is no overtime exemption for piece rate production employees. You will need to pay overtime calculated in one of the two following ways:First and less common would be to pay 1.5 times the meployee's piece rate for each item/unit produced during overtime hours. That is, if the employee is paid $1.00 per widget they make, then you could pay $1.50 per widget for widgets produced after the employee has worked 8 hours in the day or 40 hours in the week. The problem with this method and the reason most employers avoid it is that it requires the employer to track when each piece is produced. In addition, if pieces take a long time to produce, it can mean that the overtime rate is paid for the entire piece, even though only a portion was worked in overtime hours.The more common way of paying overtime for piece rate work is by computing the employee's "regular rate of pay." The general rule for computing the regular rate of pay for piece work is that you take the total compensation that the employee is paid during a week and divide it by the total number of hours worked in that week. This rate is the employee's "regular rate of pay" on which overtime is computed.I hope this helps clarify. If I have answered your questions, I would be very grateful for a positive rating so that I may receive credit for my efforts. Very best wishes to you.
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