When Are Resident Apartment Managers Entitled to Overtime Premium Pay at “Time & a Half” or “Double-Time”?
Labor Code section 510 and IWC Wage Order 5-2001 require that all workers be compensated for all hours worked, including overtime premium pay for overtime hours worked. (Lab. Code § 510; 8 Cal. Code Regs. § 11040, subd. 3(A).) Workers must be paid regular wages for hours worked and overtime premium pay in the amount of one and one-half times each employee’s regular rate of pay for any work in excess of eight hours in one day, any work in excess of 40 hours in any one workweek, and for the first eight hours worked on the seventh day of work in any one workweek. (Id.)
Workers must also be paid double-time premium pay in the amount of double each employee’s regular rate of pay, for any work in excess of 12 hours in one day and any work in excess of eight hours on any seventh day of a workweek. (Id.)
Exemptions to the overtime requirements are interpreted narrowly to protect employees. (See Ramirez v. Yosemite Water Company, Inc. (1999) 20 Cal.4th 785, 794.) Typically, resident apartment managers are not exempt from being paid overtime premiums.
As stated above, Labor Code 1194(a) protects a non-exempt employee from being bound by an agreement to waive their right to overtime premiums.
If I Have Been Paid a Salary, How Do I Determine if it Meets Minimum Wage Requirements?
Despite the fact that resident apartment managers are generally entitled to overtime premiums, most property owners or management companies attempt to pay their resident apartment managers a flat rate salary (if they pay at all). Paying resident apartment managers a salary often results in the employee being paid less than the law requires.
Resident apartment managers who are paid on salary can quickly determine their hourly rate (up to 40 hours per week, the rest must be calculated at the overtime rates) by dividing their monthly salary by 4.3 x (hours worked) to determine their hourly salary. If your hourly salary is less than $13.00 per hour, you should contact an employment attorney.
What Records Do I Need to Prove How Many Hours I’ve Worked?
The law puts the responsibility of keeping records of how many hours an employee works on the employer. California Labor Code sections 226, 1174, 1174.5, and Wage Order No. 5 7(a) mandate the employer to keep accurate records, including the number of hours worked, rate of pay for each hour, and total wages owed. It is a criminal offense for the employer to fail to keep track of the hours their employees work. (Labor Code 215.)
While the law requires employers to keep track of all hours worked by employees, many fail to do so. When the employer’s records are inaccurate or inadequate, an employee may establish a violation of state minimum wage and overtime laws by:
(1) proving they performed work for which they were improperly compensated; and
(2) producing sufficient evidence to show the amount and extent of that work as a matter of “just and reasonable inference.” (Hernandez v. Mendoza (1988) 199 Cal.App.3d 721.)
Therefore, resident apartment managers should keep an accurate record of their hours worked. If a disagreement as to the number of hours worked arises, the employee may use their notes and records to reconstruct their hours by means of a “just and reasonable” inference. The more evidence you have of hours worked, the better positioned you will be to recover under minimum wage and overtime laws. The most effective way for resident apartment managers to document their activities is to keep a daily log of duties performed and the time it took to perform them.
When Can a Resident Apartment Manager’s Free Rent or Reduced Rate Rent Be Factored into Their Compensation?
In most cases, property owners attempt to pay their resident apartment managers for the work that they do with free or reduced rent. In order to exchange living accommodations for work, the property owner most meet specific requirements. A resident apartment manager or live-in maintenance person’s apartment may only be considered part of the compensation package when certain disclosures are made. There is a strong public policy against taking advantage of an employee in regard to living arrangement.
Living accommodations can only count towards minimum wage if there is a “voluntary written agreement.” In Brock v. Carrion, Ltd. the court holds that, “Consistent with the statutory language, the DLSE requires that the written agreement explicitly reference that such credits are being applied toward the minimum wage obligation of the employer. 2002 Update of the DLSE Enforcement Policies and Interpretations Manual, at § 45.4.5.” (Brock v. Carrion, Ltd. (2004) 332 F. Supp. 2d 1320.)
Therefore, in order to validly pay the resident apartment manager by offering free or reduced rent, the agreement must meet all of the following conditions:
(1)The agreement must be in writing;
(2) The agreement must specifically state how much money is to be credited against rent;
(3) The agreement cannot credit more than the allowable amounts set forth in the wage order (in this case wage order 5-2001 permits a credit of $451.89 per month for an individual, $668.46 for a couple, or 2/3 of the fair market value of the rental, whichever is lower);
(4) The agreement must specifically say the credit is “being applied toward minimum wage.”
Failure to follow any steps will void the agreement. (Id. at 1321.)
Wage Order 5-2001’s, requirement of a “voluntary written agreement,” was clearly intended to “prevent employers from circumventing the state’s minimum wage requirements.” (Id. at 1321.) Thus, “each provision [of the wage order] places strict limits on an employer’s ability to credit lodging against the minimum wage.”(Id.) Therefore, without a valid voluntary written agreement, the employer cannot obtain an offset against the plaintiffs’ potential damages under subdivision 10(C) of Wage Order 5-2001. (Id.)
If the agreement fails to meet any of these conditions, the property owner will not be permitted to credit any of the of value rent against their minimum wage obligations to the apartment manager. Another way to put this is that the resident apartment manager will have been essentially entitled to live in the apartment for free during the duration of the defective agreement, and in addition will be entitled to collect minimum wages for every hour of work performed during the previous four years.
If the agreement is valid, and the single resident apartment manager has worked more than 56.5 hours in a month (14 hours per week), or in the case of a couple, the couple has collectively worked 83.5 hours (21 hours per week), the employee must be paid at least minimum wage for each hour worked in excess of that amount.
If I Have Not Been Paid Properly by the Property Owner What Might I Be Owed In Addition to My Unpaid Wages?
Liquidated Damages Penalty
Employees in California must be paid at least minimum wage. If you have been paid less than minimum wage, then your employer has violated minimum wage laws. Under Labor Code section 1194.2, you may make a claim for an amount equal to the wages unlawfully unpaid and any interest thereon.
Section 203 “Waiting Time” Penalties
California Labor Code section 203 provides that if an employer willfully fails to pay “without abatement or reduction, in accordance with § 201, 201.5, and 202, any wages of any employee who is discharged or who quits, the wages of such employees shall continue as a penalty for the due date thereof at the same rate until paid or until an action therefore is commenced, such wages shall not continue for more than 30 days.” (Cal. Lab. Code § 203.) You may be entitled to 30 days wages as a consequence of not having been timely paid.
Inadequate Pay Stub Penalty
Workers must be given a pay stub with their paycheck, but resident apartment managers often do not receive a pay stub. California Labor Code section 226 requires a California employer to include very specific information on an employee’s paycheck stub. The required information includes the total number of overtime hours worked, the correct rates of pay, and the legal name of the employer. (Cal. Lab. Code § 226(a).) The failure to comply with section 226 can result in penalties of $50 for the first pay period and $100 for each subsequent pay period per person in which the violation occurred over the course of a year. (Cal. Lab. Code § 226(e).) It can also lead to significant liability for the employer under California Labor Code section 226.3, which would impose severe civil penalties up to $1,000 per individual for each pay period in which there is a violation of section 226(a).
Unreimbursed Business Expenses
An employer has an obligation to reimburse an employee for all necessary work expenses they incur. (Lab. Code § 2802.) It is frequently the case that resident apartment managers incur expenses related to purchasing maintenance materials, driving their vehicle to deposit rent at the bank on behalf of the property owner, and the cost of keeping a phone that is used for company business. Resident apartment managers are often not fully reimbursed for these business expenses to the extent required by law and can bring an action against their employers to recover them.
Retaliatory Termination
If you have asked to be paid what you are owed, and in response to your request for payment you were terminated, you may have a claim for retaliation.
To establish a claim for wrongful termination in violation of public policy a plaintiff must show:
(1) an employer-employee relationship existed;
(2) they were terminated or suffered another adverse employment action;
(3) the termination of the plaintiff’s employment was a violation of public policy (or more accurately, a “nexus” exists between the termination and the employee’s protected activity);
(4) the termination was a legal cause of the plaintiff’s damage; and
(5) the nature and the extent of plaintiff’s damage. (See Holmes v. General Dynamics Corp. (1993) 17 Cal.App.4th 1418, 1426, fn. 8.)
To recover in tort for wrongful discharge in violation of public policy, the plaintiff must show that the employer violated a public policy affecting “society at large rather than a purely personal or proprietary interest of the plaintiff or employer.” (Gantt v. Sentry Insurance (1992) 1 Cal.4th 1083. 1090.) In addition, the policy at issue must be substantial, fundamental, and grounded in a statutory or constitutional provision. (Id. at pp. 1089-1095; Sequoia Insurance Co. v. Superior Court (1993) 13 Cal.App.4th 1472, 1479-1480.)
Consistent with these principles, courts have recognized tortious wrongful discharge claims where an employer terminates an employee to avoid paying wages or because an employee has complained that they are not being paid wages as required by law. (See Johnson v. Transworld Airlines (1983) 149 Cal.App.3d 518, 525; Phillips v. Geminis Moving Specialists (1998) 63 Cal.App.4th 563, 570; Labor Code §1102.5; Green v. Ralee Engineering Company (1998) 19 Cal.4 66, 76-77; Gould v. Maryland Sound Industries, Inc. (1995) 31 Cal.App.4 1137.)
The landlord may be liable for wrongful termination in violation of public policy.
Retaliatory Eviction
You may not be evicted for making a claim for unpaid wages. Residential landlords must not take any of the following actions in retaliation for the tenant’s exercising of their legal rights: Increasing rents or causing the tenant to quit the rental property involuntarily. (Civil Code section 1942.5(a), (c).)
If the tenant proves retaliation by a preponderance of the evidence he or she is entitled to a judgment of possession. (See CCP §1942.5; S.P. Growers Ass’n v Rodriguez (1976) 17 C3d 719, 724.]
Interest, Attorney’s Fees and Costs
Under the California Labor Code, you may be entitled to recover your reasonable attorney’s fees and costs in any civil action for the aforementioned violations of California labor law against you. (Cal. Lab. Code §§ 218.5, 1194, 2699(g).) Finally, interest will accrue on all of the unpaid wages at the rate of 10% per year. (Cal. Lab. Code § 218.6.)
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