Recent cases have made it clear that non-exempt workers such as auto mechanics must get paid at least minimum wage for every hour they work. If a mechanic gets paid for six flag hours, but works for eight hours, he or she must get paid at least minimum wage for the extra two hours of non-flag hours worked. This is different from Federal law, which simply divides the total hours worked into gross earnings and if the result is more than minimum wage, it is lawful.
The Court of Appeal has published a new decision, Vaquero v. Stoneledge Furniture, which holds that commissioned employees must get paid separately for rest periods. Under California law, a worker, including an inside sales person, is entitled to a paid rest period of ten (10) minutes per four (4) hours of work. Typically a commissioned salesperson is exempt from overtime provisions, but not rest period provisions, if they are paid enough to equal one-and-one-half times minimum wage and at least half of their earnings are from commission. But when an auto dealer calculates an employees wages, by whatever method, if they do not separately account for payment of rest periods, they are now have been found to be in violation of California law. The penalties can add up because an employer owes every worker one hour or pay for each day that a rest period is missed. Interest, attorneys fees and penalties can make the punishment even worse for a violator.
This has resulted in new complicated methods of pay for auto salesmen. Many dealers do not want to lose the incentive based nature of commission pay, but the new laws have auto dealers twisted into pretzels to maintain commission motivations for their sales force while complying with the labor laws in California.
If you feel you are not being compensated correctly by your employer, call George Bean Law at 714-904-9338.