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Just Because You Are a Manager Does Not Mean You Are Exempt from Receiving Overtime Pay

A commonly held myth is, “I am not entitled to overtime pay because I am a ‘manager’.”  However, because you are a “manager,” does not automatically mean you are exempt from overtime and minimum wage compensation.

Under California law, exemptions from statutory mandatory minimum wage and overtime provisions are narrowly construed.  One of the more common categories of exemptions apply to those persons employed in the “administrative, executive, or professional” capacity.  This is the category many employers use to classify “managers” as exempt from the overtime and minimum wage provisions.  The fact that you are a manager is not the test.  Rather, to be exempt under this category, an employee must: (1) be “primarily engaged in duties that meet the test of the exemption; (2) “customarily and regularly exercise discretion and independent judgment in performing those duties; and (3) earn “a monthly salary equivalent to no less than two times the state minimum wage for full-time employment.”

Generally, to qualify for the exemption, the employee’s duties must be directly related to management policies or general business operations of the employer or its customers.   An employee is “primarily engaged” in exempt duties only if more than one half of the employee’s work is devoted to such duties.   With respect to “discretion and independent judgment,” an employee who merely applies his or her skills and knowledge in following prescribed procedures is not exercising “discretion” and “judgment” of the independent sort associated with administrative work.

In short, simply because you have the title of a “manager,” does not mean you are not entitled to certain wage and hour protections, such as overtime and minimum wage compensation.