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Patrick, Esq.
Patrick, Esq., Lawyer
Category: California Employment Law
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Can employees in California be paid a "daily rate" for their

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Can employees in California be paid a "daily rate" for their work performed? If so, say for example $200 per day, how would overtime be calculated? Does this "day rate" only cover a standard 8 hour day, with anything worked over that requiring overtime?

Hello and thank you for entrusting me to assist you. My name is XXXXX XXXXX I will do everything I can to answer your question.

Employees in California can be paid a flat "daily rate," provided such rate when divided by the number of hours worked exceeds minimum wage ($8/hr).

Although daily rate pay is permissible, such flat rates cannot take into account compensation for anything more than a standard 8 hour work day. Overtime must be paid for anything over 8 hours a day or 40 in a week (even if the employee agrees that the flat rate compensates for expected overtime) calculated on the basis of the employee's "hourly rate," which is determined by taking their weekly pay and dividing by 40.

Labor Code 515 was actually amended in January of this year so as to expressly prohibit flat daily rate pay agreements that take into account overtime, even if the employee agrees to it, so it's interesting that you ask this question. You can find the State Legislature's bill amending the law here: http://leginfo.legislature.ca.gov/faces/billTextClient.xhtml;jsessionid=53cf63b3170e615a4e06d4289d98?bill_id=201120120AB2103

Please do not hesitate to let me know if you have any questions or concerns regarding the above and I will be more than happy to assist you further.

If you do not require any further assistance, please be so kind as to provide a positive rating of my service so that I may receive credit for assisting you. Very best wishes and kindest regards.

Patrick, Esq. and other California Employment Law Specialists are ready to help you
Customer: replied 3 years ago.

Hello,


Thank you for your answer to this question I just had the question come up again and want to clarify.


 


So if an employee agrees to work a 10 hour day at a flat rate, this flat rate really only includes the first 8 hours (with the remaining 2 having to be paid at an OT rate)?

Meghan,

Thanks for your reply and followup. Your re-statement is absolutely correct. Overtime will also be calculated on the basis of the flat daily rate divided by 8.

I hope this clarifies things. Please let me know if I can be of any further assistance.
Patrick, Esq. and other California Employment Law Specialists are ready to help you

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