Overtime for Salaried Employees in California
Being paid a salary doesn't make you exempt. The salary and duties tests, and how overtime is figured for salaried non-exempt workers.
In California, being paid a salary doesn't take away your right to overtime. You're exempt only if you pass both a salary test (at least $70,304 a year in 2026) and a duties test (more than half your time on executive, administrative or professional work). Salaried employees who aren't exempt get overtime after 8 hours a day or 40 a week, at a regular rate equal to 1/40th of their weekly salary.
Test 1: the salary
The executive, administrative and professional exemptions require a monthly salary of at least twice the state minimum wage for full-time work (Labor Code 515(a)), that is, 2 × $16.90 × 2,080 hours = $70,304 a year in 2026. With the minimum wage rising to $17.40, the threshold becomes $72,384 on January 1, 2027. This is far above the federal threshold, and it is a salary: a fixed amount that isn't cut for days or partial days you're available but don't work.
Some professions have their own tests: computer software professionals ($122,573 a year, or the hourly equivalent), physicians paid by the hour (at least $107.17 an hour), and certain commissioned salespeople. The details are in the Industrial Welfare Commission wage order for your industry.
Test 2: the duties
You must be primarily engaged in exempt duties, which California defines as more than half your working time (Labor Code 515(e)), measured by what you actually do, week to week. The federal rule looks at your "primary duty"; California counts the hours. In broad terms:
- Executive: managing the business or a department, regularly directing two or more full-time employees, and having real say in hiring and firing.
- Administrative: office or non-manual work directly related to management policies or general business operations, regularly using discretion and independent judgment.
- Professional: licensed practice of law, medicine, dentistry, architecture, engineering, teaching, accounting and similar fields, or work requiring advanced knowledge, or original and creative work in an artistic field.
All three also require regularly exercising discretion and independent judgment. A store "manager" who spends 60% of the shift running a register or stocking shelves fails the duties test, whatever the salary.
Overtime for a salaried non-exempt employee
California has a specific rule (Labor Code 515(d)): for a full-time salaried non-exempt employee, the regular hourly rate is 1/40th of the weekly salary, and the salary pays only for the regular, non-overtime hours, whatever the employment agreement says. Overtime is then paid on top:
- 1.5× the regular rate for hours over 8 in a day, over 40 in a week, and the first 8 hours on the seventh consecutive day of work in a workweek.
- 2× for hours over 12 in a day and over 8 on the seventh consecutive day.
Example: a non-exempt employee paid $1,200 a week works five 10-hour days. The regular rate is $1,200 ÷ 40 = $30.00. Each day has 2 overtime hours, 10 in all, paid at $45.00: $450.00 on top of the salary, for $1,650.00 that week. Note that this week's total is 50 hours, but the overtime is counted daily; the same hours aren't paid twice under the weekly rule.
Salaried non-exempt employees also get meal and rest breaks and must have their hours recorded. See meal and rest break rules.
If you've been misclassified
An employee wrongly treated as exempt can generally claim unpaid overtime for up to three years (longer in some lawsuits), plus interest, missed meal and rest break premiums, and waiting time penalties if they've left the job. Claims go to the Labor Commissioner or court. Keep your own record of hours worked.
Run the numbers
The Daily Overtime Calculator applies California's daily, weekly and seventh-day rules to your hours. To turn a salary into an hourly rate and check it against the exempt threshold, use the Salary to Hourly Calculator. More background: how overtime is calculated and the exempt salary threshold.
Frequently Asked Questions
Do salaried employees get overtime in California?
Yes, unless they are exempt. To be exempt as an executive, administrative or professional employee, you must be paid a salary of at least $70,304 a year in 2026 (twice the state minimum wage for full-time work) and spend more than half your time on exempt duties using discretion and independent judgment.
How is overtime calculated for a salaried non-exempt employee?
California sets the regular rate at 1/40th of the weekly salary, and the salary covers only the regular, non-overtime hours. On a $1,200 weekly salary the regular rate is $30.00, so each overtime hour pays $45.00.
What is the exempt salary threshold in California for 2026?
$70,304 a year, which is two times the $16.90 state minimum wage times 2,080 hours. It rises to $72,384 on January 1, 2027.
Can my employer make me salaried to avoid paying overtime?
No. A salary alone doesn't make anyone exempt. If you fail either the salary test or the duties test, you are owed daily and weekly overtime, meal and rest breaks, and the other protections for non-exempt employees.
Does a job title make me exempt?
No. Exemption depends on the work you actually do. A "manager" who spends most of the day serving customers or doing the same work as the crew is likely non-exempt, whatever the title.
This article is for general information only and is not legal advice. Sources: Labor Code 510 and 515; IWC wage orders (executive, administrative and professional exemptions); California Department of Industrial Relations minimum wage and exempt salary announcements.