Under California Labor Code § 515.6, licensed physicians and surgeons are exempt from overtime compensation so long as they are paid minimum hourly compensation. Effective January 1, 2021, the Department of Industrial Relations increased that rate from $84.79 to $86.49.

Employers must accurately track an eligible person’s hours worked and pay at least that minimum/hour to avoid paying California’s overtime premium rates for more than eight hours of work in a day or 40 in a week. Other pay systems, including lump sum weekly or monthly salaries, do not satisfy this exemption.

Eligibility requires a doctor to be “primarily engaged” (more than 50% of the time) in duties requiring medical licensure. California Business & Professions Code § 2052 defines those duties as “practicing any system or mode of treating the sick or afflicted in this state” or diagnosing, treating, operating for, or prescribing for physical or mental conditions, ailments, blemishes, deformities, diseases, disfigurements, disorders, or injury.

Employers relying on this exemption should have implemented this rate change by the January 1 deadline. Any who have not done so should correct what they have been paying doctors back to that date.

A licensed medical doctor may also qualify for the administrative, executive, or professional overtime exemptions. Each category possesses its own distinct criteria, including specific duties requirements and payment by salary equivalent to at least two-times California’s minimum wage for a 40-hour week.

For more information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

Helena Kobrin
March 12, 2021