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California - Part-time exempt employee?

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  • California - Part-time exempt employee?

    In California, is it possible to have a part-time employee that is exempt from overtime requirements? The employee is a subject matter expert that if they worked a full time schedule, would meet the requirements of an exempt professional. Since this person is retired, they only work sporadic hours, as needed and is paid a high hourly rate ($100+). The employee does not work a consistent set of hours each day or each week. He may need to travel and work 20 hours in a week or more than 40, depending on the project requirements.
    Can this employee be considered exempt from overtime requirements, simply because our customer, the Government (I work for a government contractor) does not want to pay 1.5X the employee’s rate?
    Some of our managers feel that since the employee will easily earn enough on the time that he does work during the year to meet the annual salary test, he should be exempt, even though his weekly and monthly “salary” will vary based on the number of hours he works. In addition, we will also be paying him per diem and reimburse travel expenses while he is working.
    I need to have solid facts to deter these managers and have them by Tuesday. I feel that since the employee will not have a set weekly or monthly salary, he will not be able to be exempt, regardless of his duties being considered “exempt”, were he a full time employee.
    Also, this employee must be an actual employee, not an independent contractor, due to our contract requirements.

  • #2
    This would be a "the devil is in the details" type of question. You would need to take a look at the CA-DLSE manual, chapter 54, find the very specific subset of professional, and see exactly what those rules are. I can state the obvious that there is legally not such thing as "part time" in context of the Professional exception. The rules for so-called "part time" employees are identical to those for so-called "full time" employees.

    51.6.3 The Required Salary May Not Be Prorated For Work Less Than Full-Time. Both the Legislature and the IWC clearly indicated that the salary requirement of two times the state minimum wage was the minimum which could be paid and that amount could not be prorated for part-time work. (Transcript of IWC Hearing, January 28, 2000, pgs. 65-67)
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)

    Comment


    • #3
      In California, is it possible to have a part-time employee that is exempt from overtime requirements?
      If someone is legitimately an exempt employee, I know of no law that says you have make them work XX hours a week. Having an exempt employee work "part time" becomes problematic when the employer does the math and doesn't want to meet the salary basis threshold for the amount of "part time" they would be getting. See DAW's comments.

      The employee is a subject matter expert that if they worked a full time schedule, would meet the requirements of an exempt professional.
      Exempt is based on the salary basis test and a duties test, not hours clocked. Are you saying they meet the duties test? Nothing says you can't let them go home on a half day (absent claims of differential treatment)

      Since this person is retired, they only work sporadic hours, as needed and is paid a high hourly rate ($100+).
      Wait, you're going to pay them hourly? 99% chance they are non-exempt


      The employee does not work a consistent set of hours each day or each week. He may need to travel and work 20 hours in a week or more than 40, depending on the project requirements.
      With exempt employees, you're paying for a job done, not time worked (with few exceptions).

      Can this employee be considered exempt from overtime requirements, simply because our customer, the Government (I work for a government contractor) does not want to pay 1.5X the employee’s rate?[/I]
      The exemption isn't based on what a client wants to pay


      Some of our managers feel that since the employee will easily earn enough on the time that he does work during the year to meet the annual salary test, he should be exempt, even though his weekly and monthly “salary” will vary based on the number of hours he works.
      So pay will vary based on hours worked (weekly & monthly)? Then they are non-exempt. Keep in mind the salary test usually isn't simply "annual" but has weekly/biweekly requirements


      In addition, we will also be paying him per diem

      Help!?
      Follow the link from DAW
      Last edited by Psycorps; 03-11-2010, 07:25 PM.

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      • #4
        Thank you, this is the type of information I need to take back to the managers to prove that this employee is non-exempt.

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        • #5
          We need to be clear here. The duties test is pretty much everything. There are many different types of Exempt classifications and subclassifications. For example, it is both legal and common for lawyers to be paid hourly. But if you look at the actual Professional classification, you will see that it runs pages long, with different rules for many of the sub-classifications. You need to find exactly which sub-classification is involved and look up the very specific rules associated with THAT sub-classification. We often hear about the salary basis rules, but in fact, not all Professional sub-classifications follow the salary basis test.

          Also, CA is one of the very few states that has substantial differences from the federal FLSA rules on Exempt classification. The CA-DLSE is probably the easiest place to find the correct classification rules. Most other states just follow the federal rules as is.
          "Reality is that which, when you stop believing in it, doesn't go away".
          Philip K. **** (1928-1982)

          Comment

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