Santa Rosa, CA asked in Employment Law for California

Q: I work part time. My employer is trying to switch me from salary to an hourly wage. What are they allowed to do?

I work at a winery in CA. I do direct-to-customer sales in a tasting room. My employment is part time, but I am paid a yearly salary. I make $35,000 a year and I am not considered a manger. Over-time never happens. Because of the pandemic, my employer has mentioned switching me from salary to an hourly wage until we are allowed to re-open. Do they get to choose my hourly wage, or do they have to follow FLSA in using my yearly salary and hours to determine my hourly wage? Thank You.

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3 Lawyer Answers

A: Under the FLSA, the general rule is that every employee can be paid on an hourly basis, but NOT every employee can be paid on a salary basis. Your employer may switch you from salary to hourly, and they can choose your hourly rate (as long as that hourly rate does not fall below California's minimum wage).

A: Likely the California Labor Code, not the FLSA, will control in your situation, but under either approach, the employer is always allowed to pay you by the hour, regardless of your job duties or management responsibilities. There is therefore nothing unlawful about what the employer is planning to do with you now.

That said, when things return to normal, there might be an issue if they return you to a salary basis. It is acceptable to pay you a flat fee salary, but it is not acceptable to treat you has an exempt employee if you do not otherwise qualify as exempt. That means if you work overtime you need to be paid overtime premium. You also will need to be provided with a reasonable opportunity to take proper meal and rest periods. If things change back to the way it was, you should consider speaking with an employment law attorney.

Good luck to you.

Maurice Mandel II and Alden Jay Knisbacher agree with this answer

A: Some states do not have strong wage and hour laws, California is not one of them!!!! California has some of the strongest Wage and Hour laws that you will find in the entire USA!! There are VOLUMES of Statutory law, Regulations, Wage Orders and Cases that interpret all of them. Recently the employment law world in California was atwitter with the California Supreme Court Decision in Brinker, which decided issues regarding meal and rest periods that affected all California workers. But the FLSA- Fair Labor Standards Act, is a Federal Law enacted in the FDR administration that first set minimum wages in this country. Some of the earliest laws created by the US Supreme Court came in the 1940's like Brooklyn Savings Bank v. O'Neill (1945). Think what was going on in the world in April, 1945, and the USSC was deciding a case about minimum wages.

So under the Cal. Labor Code, Ms. Herbert's answer is still correct, the default is being an hourly employee, not a salaried employee. To be salaried you have to meet one of three job type qualifications- Executive, Administrative or Professional (very limited) and you have to be paid TWICE minimum wage for a 40 hour week, on a monthly basis, or $3640 per month. (@ $10.50/hr). Since that is $43,680 per year, you may have been getting underpaid at $35,000.00 but the calculations are very complicated. So I agree with Mr. Peterson, that they can pay you a flat fee salary as long as it covers all hours you work with minimum wage pay plus OT premium pay, but they cannot consider you as exempt.

You may actually earn more as an hourly wage earner if you work overtime. Remember in Cal. you get overtime on a daily basis after more than 8 hours of work (excluding proper meal breaks but not rest breaks) and double time after more than 12 hours; plus there is a weekly overtime component after 40 hours per week.

You should look on the Labor Commissioner's website for your Wage Order and run your own calculations.

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