Employer Can Easily Revise Salary, Performance Bonus

Q: As a sales manager for a major insurance company, I am paid a base salary and monthly incentives. About nine months ago, my company announced it was withholding $200 a month from the salary of all sales managers, to be refunded (or forfeited) next April, depending on how we scored on a confidential survey about us by our sales agents.

The sales agents who report to me are surveyed about my performance and about how well I spread the company gospel. If I score really well, I could receive 150% of the amount withheld. If I score poorly, I could receive nothing.

Since this withholding comes from my base salary and not my incentive pay, is this legal? No one ever asked my permission.

--P.P., Newport Beach

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A: In its current form, this arrangement would not appear to be lawful. But a modification would make it legal.

Employers in California are not permitted to take a rebate from wages once those wages have been earned. On the other hand, unless there is a written contract, employers are permitted to change future terms of employment--including salary--at their discretion.

Instead of deducting $200 from your salary and withholding it until April, your employer could simply reduce your future base salary by $200 per month and simultaneously implement an incentive bonus system.

--James J. McDonald Jr.

Attorney, Fisher & Phillips

Labor law instructor, UC Irvine

Job Duties Determine Exempt Status

Q: I am a computer analyst for a large oil company, and am classified as an exempt employee even though I have no management or supervisory duties.

I have discussed my job classification with my supervisor and his supervisor, who insist that I am definitely an exempt employee.

Do they have a legitimate argument? I’ve donated an awful lot of extra time that I feel should have been counted as true overtime.

--R.N., Chino Hills

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A: According to California law, only “nonexempt” employees qualify for overtime compensation. Exempt employees can be asked to work unlimited hours without additional compensation.

Exempt employees are managers, administrators or executives. You have stated that you do not manage or supervise, and it is doubtful that you would qualify as an administrator in your particular job.

Professionals also are considered exempt employees. Computer programmers, as members of a “learned profession,” have been included in this category. For you, the question is whether or not a computer analyst performs the same duties as a computer programmer.

Keep in mind that job titles do not really matter for this evaluation. The determining factor is what you really do, rather than what your employer calls you.

If you do complain about your overtime, it is illegal for your employer to retaliate against you for that reason. If you have overtime accumulated, be sure to make your claim promptly. Overtime claims of more than three years would not be allowed.

--Don D. Sessions

Employee rights attorney

Mission Viejo

Work-Vacation Mix a Complex Issue

Q: My employer distributed a notice to employees stating that the office would be closed between Christmas Day and New Year’s Day. The memo further stated that employees should use vacation for this period.

To my surprise, the memo also stated that employees should call in to the office to retrieve messages and handle the messages accordingly. In other words, work on your vacation, but don’t come in to the office.

Is it legal for an employer to force you to take your vacation during an office-imposed shutdown and then require you to handle any business that may arise?

--W.I., Los Angeles

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A: Although the issue is by no means settled, a strong case can be made that your employer cannot charge your vacation account if you work during your vacation. But you may have a serious problem enforcing your right to payment unless you are willing to pay an attorney to represent you.

As we have noted many times in this column, the law does not require an employer to provide paid or unpaid vacations. But once an employer has established a practice of providing paid vacations, state law protects employees’ vested or earned vacation benefits from forfeiture. Thus, your vacation account should not be depleted if you work during your vacation.

If you actually performed work during the paid Christmas week vacation, you should file a claim with the California labor commissioner unless your vacation account was made whole for the time you worked.

Your biggest problem may be to convince the California labor commissioner to proceed on your behalf. While it is the labor commissioner’s policy to pursue claims for accrued vacation pay upon termination, it is unclear whether the labor commissioner will intervene on your behalf in these circumstances.

If the labor commissioner refuses to proceed, you should consult an employment attorney.

--Joseph L. Paller Jr.

Union, employee attorney

Gilbert & Sackman