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  • CalChamber Podcast Discusses Employee Misclassification

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    June 05, 2019
    There are so many different types of workers: hourly employees, managers, supervisors, exempt employees, and independent contractors. But how do you classify each one under California labor laws? In this episode of The Workplace, CalChamber Executive Vice President and General Counsel Erika Frank discusses exempt employee misclassification with employment law expert Jennifer Shaw. In the podcast, they discuss the differences between exempt and non-exempt employees and the common mistakes employers make when classifying their employees as exempt.


    Exempt vs Non-Exempt

    One of the most common mistakes employers make is misclassifying an hourly worker as an exempt employee. “To be exempt in California, you have to meet two tests: a salary test and a duties test,” says Shaw.

    According to California labor laws, salary means the employee’s pay is “not subject to variation based on the quality or quantity of work,” Shaw tells Frank.

    When employees are exempt, the employer does not pay overtime, but the exempt employee has more independence than an hourly employee. “Many employees want to be exempt because they don’t have to clock in and out, they can take a longer lunch, they can come and go as they please, and they are still getting the same amount of pay,” adds Frank.

    Read More and Watch the Podcast