California Overtime Laws

If you work more than eight hours in a single workday or more than 40 hours in a workweek, you may be entitled to extra pay for overtime hours. Both California and federal laws require employers to pay overtime to certain employees under certain conditions. There are many exceptions and exemptions from these rules.

The overtime laws can be confusing for both employees and employers. Overtime compensation is complex, and employers are required to keep accurate records to ensure their employees receive fair compensation.

California overtime laws provide some of the most robust protections for workers in the nation. Understanding the basics of when you qualify for overtime will help you ensure you’re receiving all the pay you’re entitled to.

Depending on how many extra hours you work, you may be entitled to be paid time and a half or double time. Sometimes employers classify workers as exempt and don’t pay them overtime for their extra work. Whether by mistake or by design, failing to pay overtime to protected employees can prove a costly mistake for employers.

Misclassified employees can recover money from their employer by filing a wage claim or a lawsuit. If you feel like your employer has illegally kept wages from you, consider speaking with an employment attorney.

Legal Authorities for Overtime

California workers are protected by both state and federal wage and hour laws. These are regulated under the following authorities:

• State authority: California Labor Code covers the primary California overtime laws. The Industrial Welfare Commission (IWC) Wage Orders, case law, and the state regulations fill in the details.
• Federal authority: The federal overtime provisions are in the Fair Labor Standards Act (FLSA). The FLSA sets minimum standards for part-time and full-time workers in both the private and public sectors. It covers several areas, including overtime. Federal case law and the federal regulations provide additional details and guidance.

California employers must follow both state and federal overtime rules. When the California and federal overtime rules conflict, an employer must follow the rule that provides greater benefits to the worker. In general, California law provides more benefits to workers.

California Overtime Calculation

Overtime pay is the employee’s regular rate of pay multiplied by the applicable overtime pay rate. Depending on how many extra hours you work, you may be entitled to time-and-a-half or double-time pay under the California overtime requirements. Let’s examine some of the important factors:

Time-and-a-Half

Overtime pay is 1.5x the employee’s regular rate of pay for:

• Hours worked over eight hours, up to and including 12 hours in any workday
• The first eight hours worked on the seventh consecutive day in a workweek
• All hours worked over 40 hours in a workweek

Double-Time Pay

Overtime pay is double the employee’s regular rate of pay for:

• Hours worked over 12 hours in any workday
• Hours worked over eight hours on the seventh consecutive day of work in a workweek

What Is My Regular Rate of Pay?

Overtime is based on the regular rate of pay, which is the compensation you normally earn for the work you perform. Your regular hourly rate can include several types of payments, such as hourly earnings, salary, piece-rate earnings, shift differentials, commissions, and nondiscretionary bonuses.

A nondiscretionary bonus is included in the regular rate of pay when it is based upon hours worked, production, or proficiency. Discretionary bonuses paid as gifts on holidays or other special occasions are not included in determining regular pay.

Counting the Number of Hours in a Workweek

Employers must calculate the workweek as a fixed, continuous, seven-day, 24-hour-per-day schedule. It does not have to be from Sunday to Saturday. It can start on any day of the week, as long as it ends seven consecutive days later.

Additional Overtime Pay Considerations

The employee’s regular rate of pay must be at least the California minimum wage, which is $16.90 for most employees as of March 2026. Some employees, depending on their location or industry, may be entitled to a higher minimum wage.

Some employers pay non-exempt employees by salary rather than as hourly employees. If an employer pays a non-exempt employee on a salary basis instead of an hourly wage, the regular rate of pay is 1/40 of the employee’s weekly salary.

For example, let’s say a non-exempt employee is paid a monthly salary of $4,160. To calculate their regular hourly rate, follow these steps:

1. Multiply monthly salary by 12: $4,160 × 12 = $49,920 (annual salary)
2. Divide by 52 weeks: $49,920 ÷ 52 = $960 (weekly salary)
3. Divide by 40 hours: $960 ÷ 40 = $24 per hour (regular rate)

If the employee works 45 hours in one week, they are entitled to:

• 40 hours at their regular rate: 40 × $24 = $960
• 5 overtime hours at time-and-a-half: 5 × ($24 × 1.5) = 5 × $36 = $180
• Total pay for that week: $1,140

Paying a salary does not automatically mean an employee is exempt. Salary is only one element of exempt status. The employer must prove three elements for the exemption. California Labor Code requires your employer to pay your overtime wages by the next regular payroll period’s payday after you earn them.

Who Qualifies for Overtime?

Overtime protections only apply to nonexempt employees. California law presumes that all employees are nonexempt and therefore eligible for overtime wages.

California employers have the burden of actively classifying an employee as exempt. Simply providing a title to an employee does not, in the eyes of the law, make them an exempt employee.

Section One of the Industrial Welfare Commission (IWC) Wage Orders lists the common exemptions to the wage orders. These orders regulate the wages, hours, overtime rate, and working conditions in certain California industries and occupations. The employer must meet all three requirements for each of the three “white collar” exemptions (executives, administrators, professionals).

White-collar employees must:

• Be salaried employees
• Be paid an annual salary minimum
• Meet specific job duties

In addition to the three main “white collar exemptions,” some wage orders add industry-based exemptions, such as:

• Computer professionals
• Commissioned inside salespeople
• Commissioned outside salespeople
• Broadcast employees
• Healthcare employees

The exemptions are numerous and complex. Under California law, it’s the employer’s obligation to prove employees are exempt.

Potential Exceptions to Overtime Pay

In addition to exempt-employee status, there are other exceptions to overtime pay. Some of the common exceptions include:

• Certain union employees, under a valid collective bargaining agreement
• Employers with an alternative workweek schedule
• Make-Up Time

Examples of alternative workweeks include a 9/80 (employees work 80 hours over 9 days) or a 4/10 schedule (employees work 4 ten-hour days in a workweek). Employers operating with an alternative workweek schedule have different overtime pay thresholds.

In limited circumstances, an employee may request time off in writing and make up that time in the same workweek. When worked, the make-up hours do not count toward daily overtime. Make-up time is distinct from compensatory time off, discussed below.

Is CTO the Same Thing as Overtime?

Compensatory time off (CTO) means that, instead of paying an employee for overtime hours, the employer provides the employee with paid time off at a later date. CTO is not the same thing as overtime. Let’s take a closer look.

CTO for Non-Exempt Employees

The rules regarding CTO for non-exempt employees differ between private and public employers. Providing private-sector, nonexempt employees with CTO instead of overtime pay for extra hours is generally not allowed. California Labor Code offers a narrow exception for private employers with very specific requirements.

Public employers may provide CTO in place of overtime, subject to specific caps and payout rules. This can be affected by a number of factors, including collective bargaining.

CTO for Exempt Employees

Exempt employees are not entitled to overtime pay, so the prohibition against CTO in place of overtime pay doesn’t apply. Employers sometimes offer CTO to exempt employees who cover extra hours as a benefit. Employers with a CTO policy in place must be careful about tracking hours worked and reducing an exempt employee’s salary. If an employer’s CTO policy treats an exempt employee like a non-exempt employee, the employer may lose the exemption.

Common Examples of Overtime Violations

Here are some of the common ways employers violate the overtime laws:

• Misclassifying employees as exempt
• Misclassifying employees as independent contractors
• Asking employees to waive their right to overtime
• Having employees work off the clock or volunteer hours
• Illegally substituting CTO for overtime pay
• Not paying for all the extra hours an employee works
• Failing to pay for unauthorized overtime

This is not an exhaustive list.

How To File a Wage Complaint

You can pursue your overtime complaint under state law, federal law, or both. Due to different filing deadlines and remedies available, it is common to file both.

State Wage Claims

Unpaid overtime is a common wage claim. Wage claims are filed with the Labor Commissioner’s Office, also known as the Division of Labor Standards Enforcement (DLSE). As an administrative process, the process is informal and usually quick.

Federal Complaints

The Wage and Hour Division of the Department of Labor (DOL) enforces the federal labor laws. This agency provides support for filers by telephone, online, and in person. Filing a complaint begins an informal administrative process.

Civil Lawsuits

An employee can file a civil suit against the employer directly in federal court or in state court under the California Labor Code. In general, an employee has three years to file a state lawsuit and two years to file a federal lawsuit (three years if the misclassification was intentional), but there are exceptions.

Potential Remedies

If your employer wrongfully withholds overtime pay, you may be able to collect the funds you’re due. The remedies available depend on your specific circumstances and the type of wage complaint you file, and include:

• Back pay
• Waiting-time penalty (California only)
• Wage statement penalties (California only)
• Damages
• Liquidated damages (FLSA only)
• Attorney’s fees
• State civil penalties
• Federal civil penalties

Each situation is different. If you’re uncertain about how to proceed, consider getting legal advice from a California employment attorney.

Have Overtime Questions in California? Get Legal Help Today

If you are a non-exempt employee and you work overtime, your paycheck should reflect it. When an employer fails to provide overtime pay for the extra hours you work, you have legal options. A California employment lawyer can help you file a wage claim or a civil lawsuit. Get in touch with an experienced employment law attorney to learn more about your rights under the overtime laws.