Law Office of Rick Morin, PC

Calculating overtime pay in California can be tricky. Unlike Federal law, overtime in California is triggered when one of two conditions are met. For purposes of this article, we are only going to discuss time-and-a-half. Under certain circumstances, an employe may be entitled to double time. Read on to learn more about how to get these calculations right!

Federal Overtime Law

Compared to California law, calculating overtime under Federal law is relatively simple. In most circumstances, overtime is triggered after an employee works more than 40 hours in a workweek. Importantly, a workweek can be any defined period of time. For instance, a workweek does not necessarily need to start on Monday.

So all you need to do to calculate Federal overtime is calculate all hours in excess of 40 hours in a workweek by 1.5x the hourly wage. For example, if an employee earns $10 an hour and works 50 hours in a workweek, Federal overtime requires paying 10 hours at $15 an hour. The total wages owed for that workweek will be $10 x 40 = $400 for regular time and $15 x 10 = $150 for overtime, for a total of $550.

California Overtime Law

Of course, things are more complicated in California. An employee is entitled to overtime pay when either of the following two conditions are met: 1) when an employee works more than 8 hours in a workday; or 2) when an employee works more than 40 hours in a workweek.

Employees and employers must keep track of both daily overtime and weekly overtime in California. The confusion often stems from scenarios where the employee earns both daily overtime and also exceeds the 40 hour limit for the week. I have seen all sorts of convoluted calculations. But the math is very simple.

Let’s use this scenario to start: An employee regularly works four days in a workweek at $20 per hour. Each daily shift is comprised of 10 hours. In this case, the employee earns 8 hours of regular time, four days a week, for a total of 32 hours of regular time. The employee also earns 2 hours of daily over time, four days a week, for a total of 8 hours of overtime. Easy! Because the employee did not work more than 40 hours in this workweek, we don’t need to worry about the 40 hour limit at all.

Here’s another scenario: An employee regularly works five days in a workweek at $20 per hour. Each daily shift is comprised of 10 hours. In this case, the employee earns 8 hours of regular time, five says a week, for a total of 40 hours of regular time. The employee also earns 2 hours of daily overtime for five days, for a total of 10 hours of daily overtime. But the employee also exceed the 40 hour rule because they worked 50 hours in total that workweek. Does the employee get overtime for those 10 hours that exceeded the 40-hour rule? No! They already received 10 hours of overtime pay under daily overtime. The employee does not get overtime on overtime.

This gives rise to the general rule: add up all of the daily overtime hours and the weekly overtime hours. The employee gets paid overtime based upon whichever number is larger. In our first example, the employee did not earn any weekly overtime, so they get paid their daily overtime hours. In our second example, the daily and weekly overtime hours are the same, so the employee gets paid the same amount under either daily or weekly.

Don’t over complicate these calculations. Follow the general rule and calculating time and a half overtime in California is very easy.