10.4 California Payroll: Wages, Overtime, Meal and Rest Periods, and Deposits

California Payroll: Wages, Overtime, Meal and Rest Periods, and Deposits

Quick Answer: California overtime is daily, not just weekly: time and one-half over 8 hours in a workday or 40 in a workweek, and double time over 12 hours in a workday. On the seventh consecutive day in a workweek, the first 8 hours are at time and one-half and everything past 8 is double time. A shift over 5 hours earns an unpaid 30-minute meal period; over 10 hours, a second one. Every 4 hours or major fraction earns a paid 10-minute rest period. Miss a meal or rest period and the employer owes one additional hour of pay at the regular rate per workday, per category. The statewide minimum wage is $16.90 per hour effective January 1, 2026, and many California cities set a higher local rate.

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1. Minimum Wage

The California statewide minimum wage is $16.90 per hour for all employers effective January 1, 2026, up from $16.50. The rate is indexed and adjusts annually.

Local ordinances often set a higher rate. Cities and counties across California — Los Angeles, San Francisco, San Jose, Oakland, San Diego, Berkeley, Emeryville, Pasadena, Santa Monica, and many others — impose their own minimum wages, and the rate is generally set by where the employee performs the work, not where the employer is based. A roofing crew that works Monday in one city and Tuesday in another may be owed two different rates in the same week. Check the local ordinance for every job site.

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2. Overtime — Where California Departs from Federal Law

Federal law requires overtime only past 40 hours in a workweek. California adds a daily rule and a seventh-day rule.

Daily and weekly overtime are not stacked for the same hour — an hour paid as daily overtime is not counted again toward the weekly threshold.

The Regular Rate

Overtime is computed on the regular rate of pay, not the base hourly wage. The regular rate includes non-discretionary bonuses, production or piece-rate earnings, and shift differentials. A roofing company paying a production bonus must recompute the regular rate for the period the bonus covers and pay the overtime differential on it.

Worked Example

A roofer earns $32.00 per hour and works 11 hours on Monday during a heat-shortened week.

$8 \text{ hours} \times 32.00 = \$256.00$ $3 \text{ hours} \times (32.00 \times 1.5) = 3 \times 48.00 = \$144.00$ $\text{Monday total} = \mathbf{\$400.00}$

If the same roofer had worked 14 hours: 8 at straight time ($256), 4 at time and one-half ($192), and 2 at double time ($128) = $576.00.

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3. Meal and Rest Periods

The Premium

For each workday that a required meal period is not provided, the employer owes one additional hour of pay at the employee's regular rate. The same is true for rest periods, separately. That is up to two premium hours per employee per day.

Roofing exposure is concentrated in three practices: crews "working through" lunch to beat the weather, a foreman calling the crew back before 30 minutes have elapsed, and an on-duty meal period that is not genuinely duty-free. All three are premium-generating.

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4. Itemized Wage Statements (Labor Code § 226)

Every pay period, each employee must receive a wage statement showing:

1. Gross wages earned
2. Total hours worked (for non-exempt employees)
3. Piece-rate units and rate, where applicable
4. All deductions
5. Net wages earned
6. The inclusive dates of the pay period
7. The employee's name and the last four digits of their Social Security number or an employee ID
8. The legal name and address of the legal entity that is the employer
9. All applicable hourly rates and the corresponding hours worked at each rate

Defective wage statements generate statutory penalties per employee per pay period, and copies must be retained for three years.

Paydays. Labor Code § 204 generally requires wages to be paid at least twice during each calendar month on designated paydays, with work performed in the first half of a month paid by the 26th and the second half by the 10th of the following month. A weekly or biweekly payroll satisfies the rule when wages are paid within seven calendar days of the close of the payroll period.

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5. Paid Sick Leave

California requires employers to provide paid sick leave to employees who work 30 or more days within a year. Accrual is at least 1 hour for every 30 hours worked, and employers must provide at least 40 hours or 5 days per year, whichever is greater under the statute's terms. Employers may cap accrual at 80 hours or 10 days and may use a front-loading method instead of accrual. Accrued paid sick leave carries over but need not be paid out at separation. Many California cities impose more generous local ordinances.

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6. Payroll Taxes, Deposits, and Returns

Deposit frequency is driven by liability, not headcount. This is a directly tested point: the schedule comes from the amount of the employer's payroll tax liability measured over a lookback period, not from the number of employees, the age of the business, or the mix of salaried and hourly workers.

Withheld taxes are trust fund money. Employee withholding belongs to the government from the moment it is withheld. Using it as working capital exposes responsible individuals — owners, officers, and sometimes bookkeepers — to personal assessment even where the business is a corporation or LLC. Sweep withholding into a separate account on payday.

Permissible deductions are narrow. California allows deductions required by law, deductions the employee authorizes in writing for insurance or benefit plans, and deductions authorized by a collective bargaining agreement. California does not allow an employer to deduct for cash shortages, breakage, loss of equipment, unreturned tools, or ordinary negligence.