Did you know that thanks to California employment law and the backing of the current Governor, California will have the highest hourly rate of pay in the USA starting January 1, 2008? California employment law will then dictate that a worker's minimum wage will be $8.00 an hour, up from $7.50 an hour.



In addition, workers under California employment law provisions will also receive an increase in meal and lodging credits by the same percentage as the minimum wage increases. Be aware though, that under employers governed by California employment law, they can use the increased amounts for meals and lodging to count against minimum wage when they provide workers with meals/lodging.

Unfortunately, if you are a federal employee and work outside California, your wage remains at $5.15/hour. That bites!

The hottest issue in California employment law is the payment of overtime. This is an area of California employment law that is pretty much akin to stepping on a land mine. Why? Because there are two classes of workers under California employment law - exempt and non-exempt - and failure to know the difference can cost business big bucks.

A non exempt employee who works overtime will be taxed on that overtime, but an exempt employee, although still taxed, would be eligible for a nice little tax rebate from the IRS.

Non-exempt workers do gain a certain level of protection though when compared to exempt workers. Their employers are subject to all the pay rules and regulations set up by the Industrial Welfare Commission, including overtime pay. This means that all non-exempt employees must be paid for all overtime hours worked.

If you are in doubt as to what category your workers fall into, check California employment law codes and regulations for the answer. If it still isn't clear, then call the Department of Labor.

As a rule of thumb, your status as an exempt of non exempt employee if governed by the responsibilities you have or your professional status. Job title or description has nothing to do with it.

Licensed professionals such as architects, doctors, lawyers, certified public accountants and engineers tend to be classed as exempt as are those in middle management who have the appropriate responsibilities. The responsibilities would include the ability to hire and fire, train employees and who spend less than 50 percent of their time performing the same duties as their employees.

The other two categories considered to be exempt are outside sales reps and those who create/formulate business policies for their organizations. Again, if you have any questions about exempt versus non-exempt employees and how to make sure they are paid according to the law, check with the nearest Department of Labor office. Save yourself some time and grief in the long run.