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  • Switching between "salaried" and "hourly" in California California

    I have a couple of questions regarding the practices of the company that I work for. We are in the private sector in California. If in any given pay period I work 80 hours or more, I am a "salaried" employee. Any hours over 80 are not given at an overtime rate, rather they are held in a different pot as compensation time and are paid at the normal 1:1 rate when used. If I work less than 80 hours in a pay period, I am now an "hourly" employee and if I only work 75 hours I only get paid for 75 hours.

    Is this legal? It seems like the company is getting the best of both worlds - they don't have to pay me overtime and if I don't work 80 hours they don't pay me for 80 hours. Can they switch between "salaried" and "hourly" at their whim?

    Additionally, the office closes for the week between Christmas and the new year. Unless you have direct budget control of your projects, you are not authorized to work - so you either have to take the week off using vacation hours or don't get paid. Is this legal?

    Thanks for your help!

  • #2
    Several questions.
    - Does the employer have at least $500K in annual sales or engage in interstate commerce? (Since this is CA I am not sure if this question actually matters since CA has it's own OT laws, and it mostly does not matter if the employer is not subject to the federal FLSA law).
    - What is the nature of the employer's business? This is to help determine any industry specific Exempt status.
    - What are your job duties? This is to help determine any duty specific Exempt status.

    ----------------------------

    Regarding the office closure:
    - Exempt Salaried employees can be docked for any entire work week involuntarily not worked (or entire work days voluntarily not worked).
    - Exempt Hourly or Non-Exempt Hourly can be docked for any time not worked.
    - Most Non-Exempt Salaried employees fall under the FLSA regulation 29 CFR 778.113 and can be docked for any time not worked. There are limited exceptions for employees paid under the Fluctuating Workweeks or Belo Plan rules (fairly strange exceptions under federal law). However, Belo Plan is not allowed at all in CA, and FW is mostly not allowed in CA.
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)

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    • #3
      Thanks for the response.

      We are an engineering firm and I'm fairly certain that our annual "sales" are about $500k and we do do work in other states.

      I am a project engineer - my duties in a nutshell are to provide construction documents (drawings/calculations), oversee the project as a whole to remain within budget, delegate tasks to junior employees and to answer questions from other design professionals to get the projects through construction.

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      • #4
        Although my opinion and $2 won't get you a cup of coffee at Starbuck's, it certainly sounds like an exempt position to me. Have you asked the employer whether they consider your position exempt or nonexempt? I'd sure be interested in hearing how they respond.

        Making improper deductions from an exempt employee's salary can invalidate the exemption. Conversely, private employers cannot bank "comp time" in lieu of overtime pay in cash. The employer can't have it both ways.
        http://www.dir.ca.gov/IWC/IWCArticle4.pdf
        I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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        • #5
          I agree with Patty that it sounds like you might be Exempt, although neither federal DOL or CA-DLSE cares even a little bit what Patty or I (or you) think.

          If you are Exempt, then what they are doing with comp time is legal. If you are Non-Exempt, then what they are doing with comp time is illegal.

          And since we are talking you maybe being Exempt Salaried, you would be subject to the federal 541.602 rules on docking (see below), plus because you are in CA must be paid a base salary of at least $600/week ($640/week next year).
          http://www.dol.gov/dol/allcfr/ESA/Ti...CFR541.602.htm
          "Reality is that which, when you stop believing in it, doesn't go away".
          Philip K. **** (1928-1982)

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          • #6
            Originally posted by DAW View Post
            If you are Exempt, then what they are doing with comp time is legal. If you are Non-Exempt, then what they are doing with comp time is illegal.
            And if you are exempt, what they are doing by docking your pay when you work a partial day is illegal (unless the partial day absence is usage of intermittent FMLA).
            I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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            • #7
              Originally posted by SEGal View Post
              Additionally, the office closes for the week between Christmas and the new year. Unless you have direct budget control of your projects, you are not authorized to work - so you either have to take the week off using vacation hours or don't get paid. Is this legal?
              Exempt or non-exempt, if you don't work for a full week, you can have your paid time off balance charged and, if you don't have enough time to cover the week, you don't have to be paid.

              A project engineer sounds like an exempt employee to me, but that could mean the company is violating law by docking pay when for partial day absences. I say "could" because it is possible that the OP missed a full day of work for personal reasons and had a day of pay docked as a result, even though he put in 75 hours during the two week pay period. That would be legal.
              Senior Professional in Human Resources and Certified Staffing Professional with over 30 years experience. Any advice provided is based upon experience and education, but does not constitute legal advice.

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              • #8
                Thank you for all of the responses. I did speak with management and they confirmed that my position is an exempt position. It just seemed odd to me that they could switch between "salaried" and "hourly" but I guess I was confusing that with "exempt" vs "non-exempt."

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                • #9
                  If you are exempt, they they CANNOT dock your salary (and it must be, in your type of position, a guaranteedsalary of at least $600/wk) for partial day absences, unless the absence is usage of intermittent FMLA. Period. How are they going to fix that?
                  I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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                  • #10
                    But what about this post from above? It sounds like they CAN dock my salary or just don't have to pay me?


                    Exempt or non-exempt, if you don't work for a full week, you can have your paid time off balance charged and, if you don't have enough time to cover the week, you don't have to be paid.

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                    • #11
                      Originally posted by SEGal View Post
                      But what about this post from above? It sounds like they CAN dock my salary or just don't have to pay me?


                      Exempt or non-exempt, if you don't work for a full week, you can have your paid time off balance charged and, if you don't have enough time to cover the week, you don't have to be paid.

                      That says for a full week. I said partial day absences.
                      I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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                      • #12
                        oh, gotcha...I had read that other one wrong. Thanks!

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