What is Compensatory Time? 

Compensatory time brings up the issue of whether a worker is qualified for additional time remuneration, and this has been a fervent case issue of late in California. The primary explanation for this is the way a representative is qualified for extra time compensation. This needs to be an accurate request that relies upon the particular certainties and situation of one’s business.

There are, however, several hard principles that are important to be aware of about overtime wages, whether you are an employer or an employee:

a) Overtime compensation cannot be waived. Any agreement by an employee to waive overtime pay or to accept less that the statutory rate he is due is invalid and unenforceable. In other words, even if the employer and employee sign a written agreement in which they will agree that the employee will not seek overtime pay, the employee will still be able to sue (and likely prevail in) later demand overtime pay for the hours worked more than the statutory workweek.

b) For the overtime rate of wage in California, the employer must be employee one-and-a-half time of his “regular” rate for every hour worked above 40 hours per week, or for any time worked beyond 8 hours per day. The employer is to pay double time when the employee works over 12 hours in a day. Under state law, the regular rate of pay is calculated by dividing a weekly salary into 40 hours or a normal workweek. Regular rate includes bonuses and commissions that the employee might be earning as part of his wages. That the commission is paid on a basis other than weekly, and that payment is deferred for a period past the worker’s normal pay day or payroll interval, don’t pardon the business from including this installment in the representative’s customary rate.

c) Certain employees are exempt from overtime laws. Under federal law, workers employed in a bona fide executive, administrative or professional capacity are exempt from overtime wage benefits. Certain kinds of employees are also exempt from overtime rules as a matter of law. This includes amusement park/recreational park employees, outside sales persons, sailors, criminal investigators, computer system analysts, baby sitters and personal attendants.

d) The time that counts toward overtime except for regular working hours is standby or “on call” time which may be compensable under federal law if it is spent primarily for the benefit of the employer and his business. This, of course, depends on the specific circumstances of each case. Under California law, an employee must be paid for a time considered to be on duty while on the employer’s premises.

f) Taking time off instead of overtime under California law, employers may not require employees to take time off instead of overtime compensation. But employees have the right to request compensatory time off at the rate of one-and-one-half hours off for each hour of overtime worked provided that a written agreement establishes this arrangement before a performance of the work.