Q: I am new to the job as a Human Resources Generalist. What do you recommend as a starting point to make sure my new business is in compliance with California law?
A: It is good practice to periodically review your pay and hour policies and practices to ensure they comply with applicable laws. Below is a partial list of steps to begin a salary and scheduling practice audit to ensure compliance:
• Make sure you are working in accordance with the Industrial Welfare Commission Wages Ordinance. Payroll ordinances, the Labor Code, and other California laws set out the rules employers must follow depending on the industry of your business. View salary orders here: https://www.dir.ca.gov/iwc/wageorderindustries.htm.
• Check and update your workplace displays. A new law, SB 657, which came into effect on January 1, 2022, allows employers to distribute some, but not all, workplace postings by mail or electronically.
• Review exempt and non-exempt classification of employees to ensure that employees are properly classified.
• Assess the status of employees and independent contractors to ensure that workers in your business are properly classified.
• Check pay dates and pay stubs to make sure they comply with California law. In most industries, employees need to be paid at least twice a month on regular paydays. In California, pay stubs must contain the following: gross wages earned; total number of hours worked (not required for exempt employees); the number of piece rate units earned and any applicable piece rate if the employee is paid piece rate; all deductions; net salary earned; the dates inclusive of the period for which the employee is paid; the employee’s name and the last four digits of the employee’s social security number or an employee’s identification number other than a social security number; the full and correct name and address of the legal person which is the employer; all applicable hourly rates in effect during the pay period and the corresponding number of hours worked at each hourly rate by the employee; and the amount of sick leave under the Healthy Workplace and Healthy Family Act available to the employee. A sample pay stub for a non-exempt employee can be viewed here: www.dir.ca.gov/dlse/Paystub.pdf.
• Review the process for reimbursing business expenses to employees, ensuring that reimbursements are made on time and supported by appropriate documentation.
• If you have employees who work on commission, make sure that written commission agreements are in place.
• Review company policies regarding meals and rest periods. Remind managers and supervisors of company policies regarding meal and rest breaks, working outside the clock, and accurately recording all time worked on a hard-copy timesheet or electronic.
• Provide additional training on wages and hours to managers and supervisors who schedule employees or who work in payroll or human resources.
• Examine your timekeeping system to see if it offers employees the ability to review and sign an acknowledgment that the time sheet accurately reflects all the hours worked, which they have been given the opportunity to. take all meal and rest periods during the pay period, and if they haven’t, have reported the situation to their supervisor for correction.
• Consider periodic training on wages and hours for employees so that they understand the importance of taking their meals and rest periods and accurately recording all time worked.
An ounce of prevention can go a long way in minimizing the risk of claims and ensuring proper payment for employees.
Sara Boyns is a lawyer with Fenton & Keller in Monterey. This section is intended to answer questions of general interest and should not be construed as legal advice. Mail your questions to Workplace Law, c / o The Monterey Herald, Box 271, Monterey 93942 or [email protected]