The California Supreme Court has ruled that the state’s overtime requirements apply to work performed in California by non-residents. In Sullivan v. Oracle Corp., three non-resident Oracle employees worked in California as instructors and trained Oracle’s customers in the use of the company’s products. They sued the California-based company for underpayment of compensation under this state’s overtime rules (employers must pay premium rates after more than eight hours of work in a day or 40 hours in a week). Oracle asserted California’s laws did not apply as these employees worked primarily in their home states (Colorado and Arizona), traveling to California only on occasion.

The California Supreme Court sided with the plaintiff-workers. Due to California’s strong policy on protecting employee compensation, this state’s overtime rules apply to anyone performing substantial work within the state, regardless of his or her state of residency. (In this case, the employees performed labor in California for days or weeks at a time. The court noted it was not addressing the situation where an out-of-state employee, say from Las Vegas, enters and leaves California as part of a single workday.)

The court’s decision is also limited to overtime laws and does not address whether employers must also take care to ensure they comply with California’s other labor laws for non-resident employees, including time card or pay stub requirements and many others.