Barber Pole, Haircut, Cosmetology

A Fresh Cut on Commission-Based Pay in Cosmetology

A recent change to the California Labor Code modifies the definition of commission pay for employees that are licensed pursuant to the Barbering and Cosmetology Act. Senate Bill 490, introduced in February 2017, adds section 204.11 to the California Labor Code, authorizing beauty salon employees to be paid commission if certain requirements are met. The requirements kick in when the employee, who must be licensed pursuant to the Barbering and Cosmetology Act is being paid for providing services where such license is required. These cosmetologists can agree to be compensated by percentage or flat rate sum commission in addition to a base hourly rate if the following requirements are met: The employee’s base hourly rate is at least two times the state minimum wage rate in addition to commissions paid; and The employee’s wages are paid at least twice during each calendar month on a day designated in advance by the employer as the regular pay day. With this new compensation option, employers will pay the break times based upon two times the minimum wage amount, which will lessen the administrative burden when compared to piece rate compensation. For example, under the new law, a salon employer could enter into a pay agreement such as the following: Salon owner Sweeney Todd agrees to pay employee…

Old school clock for punching in and out of work

Tick Tock: What’s the Unit of Measure for Minimum Wage Under the Fair Labor Standards Act

On November 15, 2017, the Ninth Circuit Court of Appeals issued an opinion of first impression in the Circuit regarding minimum wage determination under the Fair Labor Standards Act (FLSA). The panel affirmed a lower court’s decision in favor of Xerox in an action brought by customer service representatives who worked at call centers run by Xerox. The Ninth Circuit followed suit with the Second, Fourth, Eighth and D.C. Circuits, holding that the relevant unit of time for determining minimum wage compliance under the FLSA is the workweek as a whole instead of each individual hour within the workweek. See the opinion here. Xerox had a complex payment plan where employees earned different rates depending on the task and time spent on that task. Tasks outside those Xerox features in the payment plan had no specific designated rate. Hours were tallied at the end of the workweek under both categories and if the resulting hourly wage equaled or exceeded minimum wage, no additional payment was given. If the ratio falls below minimum wage, subsidy pay is given to employees to bump the average hourly wage up to minimum wage. The subsidy would ensure the appropriate hourly minimum wage for each workweek. The plaintiffs-appellants in the matter argued that the FLSA standard for measuring compliance is…

Gavel on a stack of one hundred dollar bills Murphy, Campbell, Alliston & Quinn

The EEOC’s Performance Report is a Cautionary Tale for Employers

The Equal Employment Opportunity Commission (EEOC) just released its performance report for the 2017 fiscal year. The big take away is that while the EEOC has whittled down its inventory of unresolved charges to the lowest level in 10 years, there were still over 84,000 new charges filed from nearly 700,000 calls and complaints. Additionally, with a lower inventory of unresolved charges, it appears the EEOC has been able to invest more resources in turning charges into lawsuits. The EEOC filed 184 lawsuits, more than double the number of suits filed in the previous fiscal year. All told the EEOC recovered nearly half a billion dollars from workplace discrimination claims. As the saying goes an ounce of prevention is worth a pound of cure, so feel free to contact our friendly employment law attorneys for best practices on how to protect your business.