Sometimes, an employee may complete their work but not receive the pay they are entitled to. For this reason, the employer may be required to pay the back time. Back time pay is the amount of money owed to an employee but was not paid by the employer. This can include benefits such as increment, overtime, or bonus as well as past wages to which an employee is entitled to but did not receive. In California, back pay is similar to unpaid wages only that back pay is usually calculated after its determined that the employer violated some wages or hour laws.
For instance, the employee may have been underpaid for work completed in the past if the employer improperly calculated the paycheck. The amount the employee was entitled to may be recalculated by the California Division of Labor Standards Enforcement (DLSE) and then the employee will be notified that he or she should receive back time. The employee may also notice the miscalculation and request for back pay. The back pay may be in the amount of the employee’s total unpaid hours times the hourly wage.
Generally, back pay or back time in California is the wage and hour law violations that involve improper or under-calculation of the amount of money owed to the employee. This may involve:
- Unpaid meal and rest breaks
- Overtime violations
- Minimum wage violations
- Exempt misclassification
- Unpaid sick leave
- Unpaid reimbursements
- Illegal payroll h2deductions
- “Off the clock” work
Understanding How Much Money is owed in Back Time Pay, Penalties, and Interest
The amount of money owed for back wages and back pay may depend on the actions of the employer and the type of violation. If there was no intentional wrongdoing and the back pay was due to a mistake, you may be entitled to:
- The unpaid wages as a result of the miscalculation, and
- An interest of up to 10% per year on the unpaid wages
The employer may also owe penalties and damages for labor code violations that resulted in back pay and unpaid wages. Back time payment, in this case, may include:
- The unpaid wages as a result of the miscalculation, and
- An interest of up to 10% per year on the unpaid wages
- If you did not get rest breaks and meal breaks, your employer may owe you one hour’s wages for each break that you missed
- Reasonable court costs and attorney’s fees
Conversely, if the violations were not due to a good faith error and your employer intentionally underpaid you, you may be entitled to double damages.
Overtime Back Pay
California has a daily overtime standard that requires employers to pay employees who are eligible to earn overtime for every hour over eight they work in a day. The state requires that overtime be paid even if it was not authorized in the first place. Multiple court rulings in California show that the courts have established that the employer has a responsibility to know the number of hours that the employee should work, and should as well notify them to stop working when their work hours are over. This, therefore, makes employers liable for the accumulated overtime hours.
Also, employees have the right to overtime pay if they work more than 40 hours in a week, such as when they have to work for more than eight hours a day or for more than five days in a week. In addition, employees are entitled to time-and-a-half pay if they work for seven consecutive days in a workweek. The pay covers the first eight hours of work on the seventh day. As such, if your employer didn’t pay or count you for overtime hours, your back pay award would include time and a half your usual hourly rate for every overtime hours worked. You may also be entitled to double time if you work more than eight hours on the seventh consecutive day or more than 12 hours in one day.
Not all employees are entitled to earn overtime back pay. Hourly, nonexempt employees are eligible but other categories of employees are not. The most common exemptions are for white-collar employees who do professional, high-level administrative and managerial work as well as outside salespeople. As such, you’re entitled to overtime unless your employer can show that you fit into these exemptions.
If you’ve not been paid for overtime hours, your employer may owe you the difference between what you should have been paid and what was actually paid. In time-and-a-half back pay, you should receive 50% of your hourly rate, in addition to your usual pay. For instance, you should receive $18 an hour in back pay if your regular rate is $12 an hour. Double time means that you’ll be paid $24 an hour.
Here’s an example to illustrate this further:
Jose’s regular hourly rate is $18. His employer pays him at his regular rate for work completed and for all hours worked. He worked 15 hours on Monday, 11 hours on Tuesday, and 3 hours every day on Wednesday, Thursday, and Friday. In this case, Jose isn’t entitled to overtime because he worked only 34 hours in the week. However, he is entitled to time-and-a-half since he worked more than 8 hours on Monday. Bob is entitled to time and a half back pay for the eighth to the twelfth hour on Monday, which is an extra $36 ($9 x 4 hours). He’s also entitled to double time for the twelfth to the fifteenth hour, which is an extra $36 ($18 x 2). And since he also worked for more than 8 hours on Tuesday, Jose is entitled to an extra $27 ($9 x 3). In total, Jose has an unpaid overtime claim of $99.
Minimum Wage Claims
You may be entitled to liquidated damages if your employer has failed to pay you the minimum wage for every hour that you’ve worked. Liquidated damages are meant to pay for losses that cannot be easily quantified. California law presumes that by failing to pay the minimum wage, your employer’s action or inaction has caused you to suffer additional losses. If you were not paid at least the applicable minimum wage for the hours worked, you’re entitled to liquidated damages that are equal to the amount of lost wages. For instance, if you were legally entitled to $16 an hour but your employer only paid you $13 an hour, you would be eligible to receive back pay of $3 for every hour worked. If, for example, you worked 85 hours in a pay period, your employer would owe you an additional $170 in liquidated damages and $170 in unpaid wages.
Missed Meal and Rest Breaks
California law obligates employers to provide their employees with a paid 10-minute break for every hour worked and an unpaid 30-minute meal break once they work 5 hours. There should also be another unpaid 30-minute meal break for employees who work for more than 10 hours. As such, an employee is owed one hour of pay at their usual rate for every work day that their employer fails to provide them with a meal break. This rule applies to rest breaks, as well. For instance, if you work in an 8-hour shift and you’re not provided with meal and rest breaks, you may be entitled to two hours of pay, which includes one hour for the missed rest breaks and one hour for the missed meal break.
Wage Statement Violations
Employers in California are required to provide their employees with certain information that involves their paychecks, including the hours worked, the hourly rate, deductions, total pay, and so on. This information is usually provided on the employee’s pay stub. So, if your employer provided inaccurate information or entirely failed to provide the required information, you will be entitled to wage statement penalties. In this case, your employer will be obligated to pay $50 for the first wage statement violation, and $100 for each subsequent violation. The maximum penalty is $4,000.
Waiting Time Penalties
In California, if you’re fired from your job, you have the right to receive your final paycheck at the time of termination. You also have the right to receive your final paycheck immediately if you quit and gave at least 72 hours’ notice. Conversely, your employer has 72 hours to provide your final paycheck if you quit without giving a 72 hours’ notice. Your final check must include payment for all unused, accrued vacation time as well as compensation for all hours worked. You may be entitled to waiting penalties of your check comes in later than is required by law or does not include all of the wages you’re owed.
You’re entitled to a full day of wages at your regular rate for every day that your employer withholds your paycheck. For instance, if your employer is 10 days late with your paycheck and you earn $80 per day, your employer may be required to pay you $800 in waiting time penalties.
Considerations When Calculating Back Pay
There are some considerations to keep in mind when calculating the back time pay you’re owed and the amount you can expect to receive. One consideration that is of vital importance is that employers in California are required to pay their employees interest on the wages they failed to pay. While your total back pay and interest will be calculated by the DLSE, it will still be limited to the state maximum of 10%. Another issue to keep in mind is the statute of limitations for cases of unpaid or underpaid wages in California. You typically have three (3) years to file a wage claim or file a lawsuit if you have expected back pay.
California Employees Entitled to Get Back Pay
Under California wage and hour laws, employees are typically categorized as exempt or nonexempt. Nonexempt workers are hourly or salaried employees who are entitled to receive back pay. They include persons employed in technical, professional, mechanical, clerical or similar occupations whether paid on a commission, piece rate, time, or other bases. Conversely, exempt employees may not be subject to overtime and lunch break laws. These may include independent contractors, white-collar workers, and employees earning commissions.
- Independent Contractors
Under California labor law, an independent contractor is an individual who performs service for another. An independent contractor is promised a specific payment for a specific outcome but retains control over how the task is completed. However, a worker will be considered an employee if the relationship with the person with the person who has requested the services is more like an employer-employee relationship, even if the worker was hired as an independent contractor. In this case, the worker would be protected as an employee by the California labor, wage/hour, and lunch break laws.
- White-Collar Workers
White-collar workers are individuals in professional, managerial, executive, or administrative capacities. Under California employment law, a worker must meet certain requirements so as to be considered an exempt white-collar worker. These requirements include:
- Spends at least one-half of their work time performing managerial, intellectual, or creative work
- Has independent judgment and discretion in performing their job duties
- Their monthly salary is equivalent to at least two times the minimum wage for full-time employees in California
Suing an Employer for Unpaid Wages
In the event that your employer has violated California employment laws, you may file a wage claim with the California Labor Commissioner’s Office or a lawsuit against your employer in court in order to recover back time wages, including interest and penalties. Lawsuits against employers for California wage and hour violations may include:
- Misclassifying employees as independent workers
- Failure to pay overtime compensation
- Failure to provide rest breaks
- Failure to provide meal breaks
- Late payment of wages
- Failure to pay the local county or city minimum wage
- Requiring an employee to work off the clock
- Failure to pay the California minimum wage
- Misclassifying employees as exempt employees
Back pay can be recovered in different ways. For instance, if an employee was supposed to receive a promotion that would have resulted in increased salary but then the employer failed to fulfill their promise, the employee would receive back pay in the subsequent paycheck. In other cases, the court may find that an employer engaged in California wage and hour violations and as a result, there may be a court order requiring the employer to provide the affected employees with back pay. And to ensure that the employees get the back pay as ordered by the court, the Wage and Hour Division of the Department of Labor may also get involved.
On the other hand, back pay can be ordered under different federal contract statutes under the Fair Labor Standards Act (FLSA). Under the FLSA, employees are entitled to the standard overtime pay rates if they’ve wrongfully denied overtime pay. In addition, employees must receive at least the minimum wage in back pay. It’s worth noting that an employee cannot file a private lawsuit if he or she has already received back wages or if the Secretary of Labor has already filed suit.
Class action lawsuits can be filed if an employer has violated wage and hour laws against multiple employees. This often involves unpaid wages for missed breaks or rest periods or overtime hours.
Filing a wage and hour lawsuit is usually complicated and it’s in your best interest to retain the services of an experienced California wage and hour attorney. An attorney can help you understand your rights and can file a wage claim of a lawsuit on your behalf seeking to collect your paid wages. You shouldn’t be worried about affording an attorney because your attorney will work on contingency agreement and will, therefore, ask the court to make your employer pay your attorney’s fees if you win the case.
When is an Employee Entitled Back Time?
Employees in California may be entitled to back pay anytime their wages and benefits are lost due to wrongful practices by their employer. Most employees receive back pay awards as a result of wrongful termination caused by workplace harassment or hostile work environment. Examples of wrongful employment practices include:
- Withholding overtime pay
- Denying promotions which were promised
- Firing an employee in an employment discrimination scenario
- Withholding wages because the employee reported employment misconduct or to stop them from reporting misconduct
California Statute of Limitations for Back Time Pay Lawsuits
The state of California has a statute of limitation to recover back pay. This means that you have a certain amount of time to file a wage claim or file a lawsuit following the wage violation. You can no longer claim your back wages if the time deadline elapses. Typically, the amount of time you have to file a lawsuit for back pay in California depends on the type of claim. The statute of limitations for most California wage and hour violations is 3 years from the date of the most recent violation.
The time limit is 2 to 4 years for back pay violations that involve breach of contract claims. In this case, the unpaid wage claim must be filed within 2 years if it’s based on an oral contract and within 4 years if it’s based on a written agreement.
If filing a wage claim with the FLSA, you have a 2-year time limit after the wage violation occurs. An employee can recover wages for the two years before the claim was filed if the employer had ongoing wage violations. However, back pay cannot be awarded for violations that go back further that the statute of limitations.
It’s important to file a claim/lawsuit within the stipulated time limit or your claim may be denied. Consult with a California wage and hour lawyer as soon as possible to ensure that your claim is filed within the time limit and you’ll still be eligible to receive the full compensation you’re owed. Conversely, a three-year statute of limitations applies if the employer willfully violates the FLSA.
How to Know if You’re Owed Back Pay and Wages
Most employees know if their employer owes them back pay after an investigation by the California DLSE. The agency may send out a notice to the employee informing them that they’re entitled to back pay and wages due to their employer’s state or FLSA wage violation. However, not all wage and hour violations will be caught by the DLSE and it may, therefore, be up to the employee to calculate how much they should receive in a pay period and compare that to what they are actually paid.
Protections for non-exempt employees in California include:
- Lunch breaks,
- Overtime (whether allowed or not),
- Off-the-clock restrictions, and
- Minimum wage.
Here are the California Department of Industrial Relations recommendations for employees to ensure that they are paid their full wages:
- Keep all pay stubs. Wage statements must contain information about wages earned, dates of the pay period, and deductions.
- Track all hours worked. An employee should write down the time they begin to work and when they stop for every workday, when they take meal or rest breaks, and the total hours worked
It’s also worth noting that your employer cannot retaliate against you or fire you for reporting wage and hour violations or filing an unpaid wages lawsuit or citing wage and hour violations.
Finding a Back Pay and Wages Attorney Near Me
If you feel like you’ve been unfairly treated and your employer has illegally held back wages or overtime pay, don’t wait until it’s too late to file a claim. A Stop Unpaid Wages attorney can take action to ensure you get the back pay you rightfully earned. We stand ready to help you file a wage claim or a lawsuit against your employer. Our experience with litigation and employment law makes us a powerful ally and resource for employees in California.