Do Contractors Get Overtime Pay in California?

Posted on Wednesday November 22, 2023

When someone works for a company, they are classified as either an employee or an independent contractor. An employee is someone who works for the company and gets additional benefits like overtime pay and certain legal protections. These benefits do not extend to contractors, so it’s important that you understand your rights as either a contractor or an employee when working for a company.

The law in California categorizes a worker as a contractor or an employee based on the ABC test, which is different from many other parts of the U.S. Seek a San Diego employment lawyer who can assist you in defining your employment status and rights to overtime pay.

Defining a “Contractor” vs. “Employee” 

It’s important to understand the difference between an independent contractor and an employee in California. As an independent contractor, you typically won’t receive benefits like health insurance, paid time off, or the overtime pay that non-exempt employees receive. However, some contractors are eligible for overtime under federal law – that is, if they can show they’re treated as an employee.

The ABC test is a stringent set of criteria used in California to determine if a worker qualifies as an independent contractor or an employee. It stems from Assembly Bill 5 (AB5) and the California Supreme Court’s Dynamex decision. To be classified as an independent contractor, a worker must meet all three of the following conditions:

• Autonomy: The worker must be free from the employer’s control and direction in performing the work, both practically and in the contractual agreement.
• Business Nature: The work performed must be outside the usual course of the hiring entity’s business. In other words, the worker should be engaged in an independent trade or occupation.
• Customarily Independent: The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

Fulfilling these criteria is essential for businesses in California to classify workers properly, avoiding potential legal issues and ensuring compliance with labor laws.

Overtime Pay for Employees

California’s labor laws do not require overtime pay for contractors, but the law certainly mandates overtime for non-exempt employees. If you should be classified as an employee, you should certainly be receiving any overtime pay you deserve from your employer.

Let an Employment Lawyer Assess Your Situation

Never hesitate to consult with an employment lawyer who handles wage-and-hour disputes. We can review the details of your work arrangement and compensation to determine if you should be classified as an employee rather than an independent contractor. 

If we believe you have a strong case, we can take on your claim to recover unpaid overtime and other damages. Our lawyers can also advise you on possibly reclassifying your status going forward – ensuring that you receive all benefits and protections that are owed to employees.

Contact a San Diego Employment Attorney about Your Wage Rights Now

In California, contact Mara Law Firm about any employment concerns you have. Schedule a consultation now, and our team can advise whether you have the right to seek back wages or overtime.