Wages and Compensation

October 7, 2026

Does Your Employer Have to Pay You for Travel Time to an Out-of-State Training in California?

Your employer sends you to Texas for a training course. The company pays for your airfare, hotel, meals, and other travel expenses. The training ends, and you fly back to California. Does your employer have to pay you for the hours you spend traveling home? And if the trip takes long enough, could you also be entitled to overtime? For California employees, the answer may be yes.

One common source of confusion is the difference between reimbursement of travel expenses and compensation for travel time. An employer might pay for your plane ticket, hotel, rental car, meals, and other expenses. That does not necessarily satisfy the employer’s obligation to pay wages for your time.

The separate question is whether the employee’s travel itself constitutes compensable working time. California generally focuses on whether an employee is subject to the employer’s control. When an employer requires a nonexempt employee to travel somewhere for work, the time spent traveling may constitute compensable hours worked—even though the employee isn’t performing his or her ordinary job duties while sitting on an airplane or traveling to the destination. This can be particularly important when an employee is required to attend an out-of-town conference, training program, meeting, or other company event. Federal travel-time rules can produce a different analysis. California employers therefore should not assume that compliance with federal wage law necessarily means they have complied with California law.

November 24, 2024

Two Common Misclassification Mistakes Employers Make in California

by Arkady Itkin

https://youtu.be/jMeLK35nc8g

September 10, 2023

Two Issues California Salespeople On Commissions Should Avoid

by Arkady Itkin

December 23, 2022

Who Qualifies As “Outside Salesperson” in California

by Arkady Itkin

“Outside salesperson” in California are exempt from overtime, minimum wage, reporting time and meal and rest break requirements. (Labor Code 1171). Wage Order No. 7-2001(2)(J) defines outside salesperson as “any person… who customarily and regularly workes more than half of the working time away from the employer’s place of business selling tangible or intangible items or obtaining orders or contracfts for products, servies, or use of facilities.” Based on this definition, in order to qualify as an outside salesperson, an employee must (1) work more than half the time away from his employer’s place of business and (2) be engaged in sales. The main reason for this exemption is the fact that outside salesperson generally control their own hours and are paid on commission basis. A classic example of a correct application of outside sales exemption is a door-to-door vacujm salesperson, who is on the road traveling from residence to residence.

It’s important to note that the “employer’s place of business” is not limited, under California law, to a principal places of business or an administrative headquarters. For instance, in one of their opinion letters DLSE concluded that temporary trailers and model homes located at a tract housing site, although physically separate from the home builder’s or seller’s headquarters office, nonetheless constitute “the employer’s place of business” within the meaning of the definition of “outside salespersons”. Therefore, employees who work out of temporary trailers or model homes and who sell newly constructed tract homes would not fall within this exemption unless they are customarily and regularly engaged in sales work for more than half of their work time away from the temporary trailer or model home, or other property at the housing tract owned or controlled by their employer. In the absence of such work away from their trailer / model home, these facilities would be treated pretty much like an employer’s satellite office, making those workers “inside salespersons” and not qualified to be exempt. A similar analysis applies to car salesmen who spend much of their time on their employer’s car lot, perform all of their sales work at the employer’s place of business, and thus are not covered by the ouside sales exemptions. (Brennan v Modern Chevrolet Co. (1972)).

However, recently one California Court of Appeal noted in Espinoza v Warehouse Demo Services, Inc. (2022) that the relevant inquiry as to whether an employee works away from the employer’s place of business is not whether the employer owns or controls the work site, but the extent to which the employer maintains control or supervision over the employee’s hours and working conditions. Thus, this factor also must be taken into consideration when determination whether this outside sales exemption applies to any specific employee.

January 20, 2022

Personal Liability Of Company Owners For Wage Violations in California

by Arkady Itkin

Under California Labor Code section 558.1, any employer or other person acting on behalf of an employer, who violates, or causes to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violates or causes to be violated labor code sections 203, 226, 226.7, 1193.6, 1194, or 2802 may be held liable as the employer for such violation. For purposes of this section, the term “other person acting on behalf of an employer” is limited to a natural person who is an owner, director, officer, or managing agent of the employer, and the term “managing agent” has the same meaning as in Civil Code 3294(b). White v Ultramar, Inc., 21 Cal.4th 563, 573 (1999). This law was enacted to discourage business owners from rolling up their operations and walking away from their debts to workers and starting a new company. Voris v Lampert (1999).

It’s important to note that an individual could not be liable under section 558.1 simply by virtue of his status as an owner, director or officer but he must have been “personally involved” in the alleged violations or “engaged in individual wrongdoing”. Usher v White 64 Cal.App.5th 883 (2021). The Usher court noted that there is no bright-line rule when it comes to finding individual liability, and this determination requires an examination of the particular facts of each case. The Espinoza v Hepta Run Inc. (2022) case in instructive. There, the court found that the company owner’s approval of the policy regarding paying employees was sufficient to show that he caused labor code violations and therefore could be held personally liable, even if the same owner was not involved in day to day business operations.

January 26, 2021

“Just Cause” Termination And Your Rights To Stock Options

by Arkady Itkin

July 14, 2020

On-Call Pay / Standby Compensation in California

by Arkady Itkin

The California on-call pay laws are largely based on balancing fairness between employees and employers. Generally, hours for which an employee has been hired to do nothing while merely waiting for something to happen are hours subject to the control of the employers, and constitute hours worked. (Armour & Co. v Wantock (1944); Skidmore v Swift (1944)). In the case of “standby” or “on-call” time, if the restrictions placed on the time of employee are such that the employee is unable to effectively engage in personal activities, the time is subject to the control of the employer and constitutes hours worked. (Madera Police Officers Association v. City of Madera (1984)).

The determination whether standby time is “controlled” such that it constitutes compensable hours under California law is a multi-factor analysis, set in the 9th Circuit case Berry v County of Sonoma (1994). These factors are:

The geographic restrictions on the employee’s movements;

March 7, 2020

Moving For A Job? – What You Need To Know About Relocation Packages

by Arkady Itkin

There are two important things any employee who moves for a new job and receives a relocation package as part of the job offer, should keep in mind:

(1) Review the repayment obligation in your relocation package to make sure that it’s fairly drafted. Most relocation packages and sign-on bonuses include a repayment provision, also known as a “clawback” provision. An experienced employment attorney can go over it with you and discuss typical issues that arise with relocation packages, such as wanting or having to leave that job for one reason or another much sooner than expected, as well as negotiating the type of pro-rata repayment plan that will not hold you hostage till the very last day of the total repayment period.

(2) Do not rush to spend every dollar of your relocation package. There is just no way to know for sure how your new job that you are excited about is going to work out. There could be so many reasons why you would want to quit that job and /or even move back as soon as possible. If you receive a generous relocation package of say $50,000.00, you may only need $10k-$15k for your moving expenses. Hold on to the rest for at least while, until you are settled at your new job in the new city. This way, if you have to leave it all and move back, repaying your employer while you only spent a small part of that amount would be so much easier than if you hurry to spend all that amount right away. I would recommend waiting for at least 6 months after you move, before you touch the remainder of the relocation package that you didn’t have to spend when you moved.

January 19, 2020

Increase in Salary For Computer Professional Exemption in California

by Arkady Itkin

Under California Labor Code section 515.5, certain software industry employees are exempt from overtime pay requirements, if they perform specific, exempt duties and receive a rate of pay not less than the statutorily-specified rate.

Effective January 1, 2020, the computer software employee’s minimum hourly rate of pay, in order to be subject to this exemption, increases from $45.41 / hour to $46.55 / hour, the minimum monthly salary exemption will increase from $7,883.62 to $8,080.71, and the minimum annual salary exemption will increase from $94,603.25 to $96,968.33.

In order to be correctly classified as exempt from overtime under the California computer professional exemption, all of the requirements of section 515.5 must be met. Thus, for instance, an employee how is paid more than the above referenced minimum, but who performs work that lacks in creativity and independent judgment required by this law, as it’s often the case with IT administrators, will not qualify for this exemption and should be eligible for overtime pay, like any other non-exempt, hourly employee.

November 1, 2019

For Employers: Is Conditioning Final Pay On Repayment of Relocation Bonus A Good Idea?

by Arkady Itkin

In most cases, it’s not a good idea for an employer to refuse to issue an employee his final paycheck until he repays his relocation bonus. Likewise, it’s a bad idea to unilaterally deduct the relocation bonus amount from that employee’s final paycheck. Here is why:

First, an employee’s failure to repay his relocation bonus or his failure to honor some other part of your employment agreement is legally not a defense to the legal requirement of paying all wages. A number of laws mandate upon employers to promptly pay all wages due to employees and prohibit taking improper deductions from paychecks except as authorized by law. Further, it has been held that an employer may not set off debts a terminated employee owes the employer against wages due to that employee. Barnhill v Robert Sunders & Co. (1981).

Secondly, when you don’t pay the wages due to an employee, you may be liable not only for the wages unpaid, but also for penalties, interest, and possibly – that employee’s legal fees, if he decides to pursue his claim for unpaid wages in court as a single claim or along with other claims (i.e. wrongful termination, discrimination, retaliation, etc…). This can be especially costly and not worth the risk in a situation where an employee is a high-wage earner, who received a relatively modest relocation bonus, as it may result in much greater liability for waiting time penalties (up to 30 days of that employee’s ordinary wages). To illustrate, imagine the following scenario: you hire a worker at a rate of pay of $800/day after issuing him $10,000 as a relocation bonus to be repaid, if the employee quits or is fired for cause before his one-year anniversary of employment with you. That employee resigns three months later. You refuse to issue his final paycheck until he repays his relocation bonus. That employee waits for a month and then files a claim for unpaid wage with the Department of Labor. He will then be entitled to his unpaid wages for two weeks plus up to $24,000(!) in waiting time penalties ($800 x 30 days as per California Labor Code 203). That employee then repays you relocation bonus, ending up receiving a total of $14,000 more from you than he should have and otherwise would have.