FAQ’s Regarding California’s Caregiver Overtime Laws
With the new overtime requirements under the newly enacted Domestic Workers Bill of Rights (AB241), I’ve received a lot of questions about how the law will impact caregivers and the families they serve. Many employers and employees do not understand their rights and obligations. Hopefully the following answers to some of the common questions I’ve been receiving will help clarify the law.
Keep in mind, this is a newly enacted statute with some ambiguities. Future cases or amendments could affect my interpretation of the statute.
Q: My employer told me that they are reducing my pay rate so they can afford to pay overtime. Can my employer do that?
A: Usually, yes. Most employees are employed “at-will.” This means the employer or the employee can terminate the employment relationship at any time, with or without notice, and for any reason or no reason (except an illegal reason). When an employer lowers an employee’s pay rate, the employer is effectively terminating the old employment relationship and offering new employment under the new lower rate of pay. Your continued employment constitutes acceptance of the terms of the unilateral contract. As long as the employer notifies the you of the new terms of employment (e.g., the new rate of pay), the employer can change the terms. An employer may not retroactively alter the terms of the employment.
Employers are supposed to provide employees a new Notice to Employee under Labor Code section 2810.5 whenever the employer changes the employee’s pay rate (or any other item included in the 2810.5 Notice to Employee).
Q: Can an employer deduct the cost of room and board from an employee’s pay?
A: Yes, if the employer provides meals and lodging to an employee, even if the meals and lodging are provided at the client’s site, an employer can deduct specific amounts for the meals and lodging as a credit against the employer’s minimum wage obligations. The employer must have a written agreement, and can only deduct up to certain amounts specified in the wage order. Generally speaking, the amounts an employer can deduct are fairly low, and are usually well below fair market value (For example, an employer can only deduct $2.90 for breakfast, $3.97 for lunch, $5.34 for dinner, and $37.63 per week for an unshared room), and the employee must actually receive the meals or lodging if the employer is going to use that as a credit against the employer’s minimum wage obligation.
Q: Can I pay a caregiver a “daily” or “weekly” rate?
A: You can, but you shouldn’t. A daily or weekly rate is a salary. The law says that a salary only compensates an employee for the “regular nonovertime hours” worked. For a domestic work employee that qualifies as a personal attendant, this means the first 9 hours in a day or the first 45 hours in a week. If you pay a worker a daily or weekly salary, you are not paying the employee for any overtime hours. All caregivers should be paid by the hour and should be paid for all hours worked.
Q: Can my employer deduct for sleep time?
The California Supreme Court granted review of Mendiola v. CPS Security Solutions, Inc. in the fall of 2013. Until the Supreme Court issues its decision, employers may not be able to rely on the sleep time rules stated below. If you have questions about your work situation, contact an attorney familiar with California’s overtime requirements.
A: Under Mendiola v. CPS Security Solutions, Inc, an employer can deduct for sleep time as long as:
- The employee regularly receives at least 5 hours of uninterrupted sleep;
- The employee is provided a comfortable place to sleep;
- The employer and employee agree (preferably in writing) that the sleep time is not compensable; and
- The employee works a 24-hour shift.
If any of those factors are missing, the employer cannot deduct for sleep time. Additionally, the employer can only deduct the actual number of rest time hours, up to a maximum of 8 hours per 24-hour shift. So, if the employee only receives 6 hours of uninterrupted sleep, the employer can only deduct those 6 hours. If the employee receives 10 hours of uninterrupted sleep, the employer can only deduct a maximum of 8 hours.
As noted in the update above, Mendiola v. CPS Security Solutions, Inc. is currently under review and therefore an employer may not be able to avail itself of the sleep time rules.
Q: If I work in San Jose, but the care agency that employs me is located outside of San Jose, am I still entitled to the San Jose minimum wage?
A: Yes. Certain cities, such as San Jose and San Francisco, have adopted their own minimum wage ordinances. Any employees performing work within the geographical boundaries of the specified cities must receive the minimum wage set by the ordinances. In San Jose, the minimum wage is $10.15 per hour. In San Francisco, the minimum wage is $10.74 per hour.
Q: My employer wants me to become an independent contractor. Is that legal?
A: Likely not. There are a number of factors that determine whether a worker is an employee or an independent contractor, and the tests can differ from agency to agency. Under the Domestic Workers Bill of Rights, an employer includes anyone that exercises control over the employee’s hours, wages or working conditions. It is hard to imagine a scenario where the caregiver has 100% control over his or her hours, wages and working conditions. If you are working one day as an employee, and the next day as an independent contractor without any other changes, chances are you are really an employee.
Q: I run domestic worker placement agency. Do I have to comply with the new overtime laws?
A: Not if meet the definition of a domestic work employment agency under Civil Code section 1812.5095. See my article to see if you meet all of the requirements.
Q: Which hours are counted toward the weekly overtime? I work 12 hours a day, 5 days a week. By the 4th day I’ve worked 45 hours. Does that mean that the 5th day is all overtime?
A: The Domestic Workers Bill of Rights uses the same, or substantially similar, language as other overtime statutes in defining which hours require overtime payments. Cases interpreting those statutes make it clear you only count the regular hours worked towards the weekly overtime. In other words, you only count the first 9 hours worked toward the weekly 45 hour maximum. You don’t count the daily overtime hours toward the weekly maximum because the employer already paid overtime for the hours in excess of 9 per day.
The following examples may help.
Hopefully these answers help. Each situation is unique. The questions and answers provided above are for general information purposes only. If you have questions or concerns about your particular situation, contact an employment attorney familiar with wage and hour issues in the elder care industry.
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