March 3, 2023

Tech Tip: How To Calculate Payroll Using the California Overtime Rule

tech tip

Calculating overtime for the employees is a continuous query knocking at the door of Humanity customer support. California’s overtime laws add complexity to payroll calculations for any organization with workers in the state, so we designed the “California Overtime” rule in our Humanity Scheduling software to help users abide by these rules.

What is California overtime and its regulations?

California overtime laws differ from most other states in the U.S. According to the California Department of Industrial Relations, “California law requires that employers pay overtime, whether authorized or not, at the rate of one and one-half times the employee’s regular rate of pay for all hours worked in excess of eight up to and including 12 hours in any workday, and for the first eight hours of work on the seventh consecutive day of work in a workweek, and double the employee’s regular rate of pay for all hours worked in excess of 12 in any workday and for all hours worked in excess of eight on the seventh consecutive day of work in a workweek.” This is also known as California Wage Order 15.

The team behind Humanity Scheduling created the California module to make it easy for managers to ensure overtime is accurately calculated according to these rules.

How do I enable the California Overtime rule in Humanity?

Using the California Overtime rule in Humanity is easy. Managers and Administrators can begin by going to Payroll > Payroll Settings > Select “California” from the drop-down in front of “Overtime calculation module” > Save settings

Overtime Calculation Module 01

An advanced setting is also linked when California is selected for “Overtime Calculation Module” that states “Implement Order 15 exception to California OT *Advanced.”

Overtime Calculation Module 02

The difference when enabling and disabling this setting is illustrated in the following table.

Overtime Calculation Module 03

The Humanity California overtime rule is set up to follow the regulations of the state of California. Want to ensure you’re paying accurate overtime for workers outside of California? The Humanity solution also supports “Rate Cards” for users in other geographic locations to customize calculating overtime based on their business needs. Managers can design a custom overtime rule by using the “default” rate card provided in the Payroll settings. This makes it easy to pull up payroll overtime reports based on the prerequisites of the company.

Looking for more tips on our Humanity Scheduling solution? Check out our Help Center or email us at Happy Scheduling!