Exempt and Nonexempt in California Minimum Wage

 California preschool teachers and preschool staff are considered non-exempt employees and thereby subject to the California minimum wage requirements.  Some areas are, in addition, mandated by local minimum wage requirements. Please check with your city/county to see if this applies to you as you will need to identify the stricter standard that is more beneficial to the employee.  Number of employees is based on tax identification number so if you have the same tax identification number as your church and elementary school, you will need to include all employees in your count. California’s minimum wage changes for the upcoming years are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

If your preschool director meets the requirements for exempt employment, they will need to be paid twice minimum wage in order to continue to qualify for exemption.  Below are the managerial and administrative exemptions as defined by California law.

1. Executive/managerial exemption
In order to meet the executive (managerial) exemption, the employee must meet all of the following requirements:

  1. Employee’s duties and responsibilities involve the management of the enterprise in which he or she is employed or of a customarily recognized department or subdivision of the enterprise;

  2. Employee customarily and regularly directs the work of two or more other employees;

  3. Employee has the authority to hire or fire other employees, or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status or other employees is given particular weight;

  4. Employee customarily and regularly exercises discretion and independent judgment in performing his or her duties;

  5. Is “primarily engaged” in duties that meet the test of the exemption;

  6. Earns a monthly salary equivalent to no less than two times the state minimum wage for full-time employment.

The term "primarily engaged in" means that more than one-half of the employee’s work time must be spent engaged in exempt work and differs substantially from the federal test which simply requires that the "primary duty" of the employee falls within the exempt duties. Therefore, to qualify for this exemption, the employee must spend more than 50% of their work time on exempt duties.

2. Administrative exemption
To meet the administrative exemption, an employee must meet all of the following requirements:

  1. Employee spends more than one-half of their work time performing office or non-manual work directly related to management policies or general business operations for the employer or the employer’s customers;

  2. Employee “customarily and regularly” exercises discretion and independent judgment in carrying out job duties as to matters significant to the employer’s business;

  3. Performs his or her job only under general supervision and works along specialized or technical lines requiring special training, experience, or knowledge; and

  4. Is paid a salary equivalent to no less than two times the state minimum wage.

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