By Samson Elsbernd , Esq.
Wilke, Fleury, Hoffelt, Gould & Birney, LLP
Employers are generally required to pay nonexempt California employees overtime for any hours worked in excess of eight in one day or forty in one week, and for the first eight hours worked on the seventh consecutive day in a workweek. Employees are entitled to payment for overtime - even if not reported - when their employers have actual or constructive knowledge that they are working overtime. A recent court of appeal decision is instructive, and affirmed judgment for the employer because the employee could not prove his employer was aware of his off-the-clock hours.
In Jong v. Kaiser Foundation Health Plan, Inc., 226 Cal.App.4th 391, 399 (2014), Jong, and other non-exempt employees, brought a putative wage and hour class action against Kaiser for non-payment of overtime compensation. Jong argued that his job could not be completed unless he worked overtime, and that he was criticized for working overtime, which was why he worked overtime hours off-the-clock. But Jong was unable to demonstrate that Kaiser knew or should have known that he was working unreported overtime hours. He had no evidence that his supervisors told him he could or should work off the clock, or that he should not report his overtime. When Jong reported overtime work, he was paid for that time. Jong also signed an attestation acknowledging that off-the-clock work was a violation of Kaiser's policies. Accordingly, Jong could not prove that Kaiser should have paid him for his unreported overtime hours because Kaiser was not aware of his unreported overtime.
Employers should be particularly sensitive to wage and hour claims, which are particularly ripe for class action lawsuits. Additionally, failing to compensate employees for overtime can subject employers to civil lawsuits to recover unpaid overtime, including interest, attorney fees, and costs of suit. Once employers become aware of unreported overtime, they should address it. They may require employees to sign attestations that failing to report all hours worked violates company policy, and to verify the hours worked on their timesheets. If they have policies prohibiting overtime work without prior approval, they may discipline employees for working unapproved overtime. However, employers should still compensate employees for all time worked of which they are aware.
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