Legal Question in Employment Law in California
Exempt from Overtime Pay?
I know somebody who is a commissioned employee at a software company, are they eligible for overtime pay? They agreed that they would be paid solely on a percentage of their sales...is overtime therefore irrelevant? The reason I ask is because they are claiming that overtime pay due is to them.
Also, how should lunch periods be enforced? Should an employer force an employee to take a lunch break? Must an employee be reminded to take a lunch break...as in the case of a commissioned employee? Is an employer at fault in any way for not ''forcing'' an employee to take a break period?
2 Answers from Attorneys
Re: Exempt from Overtime Pay?
Only outside commissioned salesman, who spend more than half their time selling, and who earn at least twice the current minimum wage are exempt from overtime and having to take lunch breaks. If the employee works inside the company, there is no exemption from overtime and lunch breaks must be taken. Otherwise, the employer is liable for a penalty equivalent to one hour pay for the lunch break not taken, even if the employee refused to take the break.
Re: Exempt from Overtime Pay?
The information in the prior response is generally correct, except that under Industrial Welfare Commission Wage Order 7-2001 covering employers in the Mercantile Industry, (as well as Wage Order 4-2001) the daily and weekly overtime requirements of California law do not apply to an employee whose earnings exceed one and one-half times the minimum wage if more than one-half of the employee's compensation represent commissions. The employee must be engaged in sales to qualify for this overtime exemption.
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