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Rewards of Management Do Not Include Overtime Pay

October 10, 1994

Question: I am an exempt manager whose company requires me to take vacation time in half-day increments if I need to be away from the office on personal business. Additionally, if I run out of sick leave I would be docked in partial-day increments if I should get sick during a business day and need to leave work. My average workday is 11 hours, or about 55 to 60 hours each week. Am I really exempt or should I be compensated for overtime?

--Huntington Beach

Answer: Employees in executive, administrative and professional positions are generally exempt from the wage and hour laws that establish the right to overtime pay. You describe yourself as a "manager," which would generally be considered an executive or administrative position. Therefore, you are probably in fact an "exempt" employee, and, therefore, not entitled to overtime pay.

--Calvin House, attorney, Fulbright & Jaworski L.L.P., Adjunct professor, Western State University College of Law

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Question: I was recently let go from my job as a manicurist. I was told by the salon management that I was an independent contractor, but my hours were specifically set by the salon and I was even pressured into donating my services to various charitable events sponsored by the salon, which the owner would later take as a tax deduction. Do I have any legal recourse?

--K.T., Irvine

Answer: Perhaps. If you were not truly an independent contractor, but were an employee, and your employer failed to pay you for work done, or for overtime compensation, you would be able to pursue a claim against that employer for unpaid wages with the California Division of Labor Standards of Enforcement.

--Michael A. Hood, Employment law attorney, Paul, Hastings, Janofsky & Walker

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Question: I was terminated from a computer industry job after 16 1/2 years, where I had been a senior applications analyst and database consultant. One month before my termination, management placed me under a "performance-improvement plan," which was a big insult. I was also given the demeaning task of "tagging" a customer's PC inventory, which was like being asked to "do the windows." Such tasks, or moving a customer's equipment after an internal office relocation, were not part of my job description.

But I performed all tasks required of me during eight of the 22 working days during the so-called performance-improvement plan period. The rest of the time I was left idle. Then I was fired.

I believe this was a setup by the company's new management to avoid having to pay a considerable amount of severance pay and other layoff benefits under the company's written policy and guidelines. I would appreciate your suggestions as to courses of action that I may take, and what my legal rights are in this matter.

--G.U., Irvine

Answer: Your situation is somewhat complicated, and you will need to consult with an experienced employment lawyer before deciding whether to proceed with a lawsuit. While you may have felt insulted by certain work assignments and by being placed on the "performance-improvement plan," these matters are ordinarily within management's rights.

Often, business needs dictate that employees be assigned to perform tasks that they may consider beneath their dignity. Also, management sometimes will take a different view than an employee of the adequacy of that employee's performance. These realities of the business world do not provide the basis for a lawsuit.

On the other hand, if you have some proof that you were fired in order to prevent you from obtaining severance benefits or because new management just wanted to "clean house" of long-term employees without regard to their performance, you may have a viable claim. The Employee Retirement Income Security Act (ERISA) is a federal law that, among other things, prohibits employers from firing employees just to prevent them from obtaining benefits, such as severance pay.

You do not mention your age, but if you are over 40 and younger employees with work records similar to yours were retained, you may have a claim under the age discrimination laws as well. Finally, your longevity, combined with certain policies and practices of your employer, may give you a right under the law not to be terminated except for good cause if you can prove that the real reason you were terminated is because new management wanted to get rid of employees from the old regime. In that event, you may have a claim on this basis as well.

--James J. McDonald Jr., Attorney, Fisher & Phillips, Instructor, UC Irvine

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Question: If your employer relocates its operations out of state and the company offers you a job in the new location, but you refuse to move, can you still collect unemployment in California?

--D.T., Corona del Mar

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