Commissioned Employee Rest Break Pay

A California Appeals Court recently issued a ruling Vaquero v. Stoneledge (Feb. 28, 2017) B269657 (“Vaquero“) that interprets Wage Order No. 7 to indicate that piece rate and commissioned employees must be paid separately for required rest breaks. Additionally, employers must ensure they do not take a draw against that compensation.

Employers who pay a base rate of at least minimum wage are likely already in compliance with the rule, as long as the necessary paid breaks are provided. However, employees who are paid on commission only or earn a piece rate may not currently receive actual compensation for breaks, as a draw against future commissions cuts into money employees will earn for sales, rather than compensating them for down time.

To ensure compliance with the law for piece rate and commission-only employees, time spent on paid breaks should be tracked and made into a line item on their regular paychecks. This time should then be paid by the employer as if the employee was a regular hourly worker during those break times. The rate of pay for this time should be the employee’s regular rate (earnings ÷ hours) or the applicable minimum wage, whichever is greater.

Source: HR Support Center  |  2017 © Copyright Payroll Masters

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