Alternative Workweek Arrangements in California

As always, be careful when dealing with employees. I recently was contacted by a small business owner in Sunnyvale who was irate because her previous business attorney assisted her with a new alternative workweek schedule and all the employees agreed. Then, years later, they had to lay off some employees and the terminated employees just made a claim for overtime for all the hours worked over eight in a day. Because the alternative workweek was not agreed to in a secret ballot, it was not upheld by the Labor Board and her company had to pay significant amounts to several ex-employees.

In the past few years, I’ve noticed that more and more small businesses and corporations in San Jose and throughout Santa Clara County have moved a portion, or all, of their employees from a standard five day, eight hours a day workweek to a four day, ten hours a day workweek. A company that is interested in implementing this type of alternative workweek schedule must go through the proper process for implementing the schedule, or the company may risk misclassifying employee hours worked and end up paying penalties and fines for the misclassification. If an alternative workweek schedule is implemented correctly, an employer may be exempt from paying overtime to employees working up to ten hours a day, four days a week. Alternative workweek schedules can be proposed for an entire work unit or as a part of a menu of options for a work unit.

In California, there are several actions that must be taken before an alternative workweek schedule can be adopted by a company. A company cannot simply impose the new schedule on its workforce. One required action is for the company to hold a meeting with employees who would be affected by an alternative workweek schedule. The meeting is held so that the employer can discuss the effects of the alternative workweek on the affected employees and the employees can vote on the proposed schedule.

The following are some steps that should be taken before the vote can take place:

• The employer must first provide a written notice to the affected employees. The notice will inform the employees that the company would like to adopt an alternative workweek schedule, and invite them to attend a meeting to discuss the effects of the alternative workweek and vote on the proposal. The written notice, which must be provided 14 days before the actual vote, should disclose the effects of the proposed arrangement on employees’ wages, hours and benefits, and include meeting logistics.

• The proposed alternative workweek schedule must be adopted in a secret ballot election by at least two-thirds of the affected employees in the work unit. The secret ballot election must be held during regular working hours at the employees’ work site.

• Ballots for the election can only be cast by the affected employees.

• The results of the election must be reported by the employer to the Division of Labor Statistics and Research within 30 days after the results of the vote are final. The report must be given in letter format and must include the date of the election, a final tally of the vote (number of “yes” and “no” votes), the size of the unit considering the change to an alternative workweek, the nature of the employer’s business, contact name and phone number. This information becomes public record.

• The letter must be sent to the following address:
Division of Labor Statistics and Research
455 Golden Gate Avenue, 9th Floor
San Francisco, California 94102

• If a work unit votes in favor of an alternative workweek schedule, employees who are affected by the change may not be required to work those new work hours for at least 30 days after the announcement of the final results of the election.

If an employer adopts an alternative workweek schedule consisting of four, ten hour days, the employer must still pay overtime pay of 1½ times the hourly rate for any hours worked in excess of ten hours per day up to twelve hours, and double time for any hours worked over twelve. The employer must also have a standard five days, eight hours schedule available for employees who are unable to work the four day schedule.

If you have any questions about implementing an alternative workweek, talk to a professional with experience in this area and don’t assume that if all the employees agree everything will be fine.

Structure Law Group, LLP attorneys are available to assist you in implementing an alternative workweek schedule.