Our Payroll Compliance Checkup Webinar was held on June 3, 2026. Below is the full video recording if you missed it or want to rewatch it.
Questions Answered During the Webinar
In the video, skip to the time stamp indicated below for the question and corresponding answer.
32:13 – Do you have to have 2 non-productive times in the non-productive time entry?
32:34 – What are the penalites for missed meals?breaks?
32:58 – Do you have to pay non-productive time when an employee is walking to their vehicle from their break?
49:04 – How is overtime premium paid in piecework?
54:07 – How are breaks paid when there’s a combination of hourly and piecework done during the work?
1:06:08 – Is there a report to make sure rest and recovery is being paid correctly?
1:07:19 – If your employees are only working hourly, do you still have to pull out breaks?
1:16:50 – How is sick pay paid for salary employees?
1:20:14 – When there’s a break in employment, what is an employee’s anniversary date for sick pay purposes – their rehire date or original hire date?
1:21:35 – Should salary be set up to the piecework type to document hours worked?
1:23:15 – Why do rest and recovery amounts sometimes change between running the batch report and creating checks.
1:26:07 – How do you handle retro pay from 2 weeks prior? (More instructions on this topic will be coming soon)
Additional Questions
Below are answers to questions asked during the webinar that could not be responded to in the time available.
What is the minimum missed meal time?
“If an employer fails to provide an employee a meal period in accordance with an applicable IWC Order, the employer must pay one additional hour of pay at the employee’s regular rate of pay for each workday that the meal period is not provided. IWC Orders and Labor Code Section 226.7. This additional hour is not counted as hours worked for purposes of overtime calculations.” (DIR Meal Periods FAQ)
“If an employer fails to provide an employee a rest period in accordance with an applicable IWC Order, the employer shall pay the employee one additional hour of pay at the employee’s regular rate of pay for each workday that the rest period is not provided. Labor Code Section 226.7 Thus, if an employer does not provide all of the rest periods required in a workday, the employee is entitled to one additional hour of pay for that workday, not one additional hour of pay for each rest period that was not provided during that workday.” (DIR Rest Periods FAQ)
I have a salary employee that works 30 hrs/week. What calculations should be made to pay the correct annual amount?
“To meet this initial requirement of the exemption test, an employee must earn no less than twice the state minimum wage for full-time employment.” (DIR New Release page).
From our understanding, there is not an allowance for calculating an alternate minimum annual amount based on a lower number of hours worked. If you pay a salary in California in 2026 under 70,304, the employee would be non-exempt for overtime.
Do we have to pay breaks for employees who are paid daily rates?
For purposes of the software, the Base Pay Type is set to Piecework so that hours can be tracked. However, the employee is not engaged in piece-rate compensation based on the DIR’s definition: “Work paid for according to the number of units turned out.”
Therefore, a piece-rate must be based upon an ascertainable figure paid for completing a particular task or making a particular piece of goods. So there is no need for breaks to be paid separately at the regular rate of pay.
If I have an employee working two days of the week doing piecework and then the other three days doing hourly work, how do we calculate the minimum wage?
Minimum wage is calculated on piece-rate earnings only to ensure employees receive minimum wage for that work. The default setting of Datatech software does not include hourly wages against piecework, even if the employee is paid a highly hourly rate. We have had some customers change these settings, but it is not recommended. You can select whether the minimum wage calculations are made for the week (minimum by law) or daily on the Daily Payroll Batch Report.
How do we calculate the break pay rate?
An average hourly rate is determined by taking the total compensation for the workweek, excluding compensation for rest and recovery periods, and any premium compensation for overtime and dividing that by the total hours worked during the workweek, excluding rest and recovery periods. Note that this is based on hours worked; pay for holiday, vacation, sick pay, and penalties would not be included. This type of formula is similar to the manner in which employers are currently required to calculate a regular rate of pay for overtime compensation purposes. The Division of Labor Standards Enforcement Manual contains information on the types of compensation within a workweek that generally must be included for this purpose and those that are not. – See DLSE Manual, §49.1 to 49.1.2.3 (items to be included) and §49.1.2.4 (types of compensation not included).
If an employee is paid by pieces and a correction is needed, can positive and negative entries be done?
Yes, if you are making a correction you can enter the correct number of pieces and then a negative entry for what was paid. To accurately re-calculate MW, RR, OP, you would enter all of the wages for the check as they should have been paid, and create the check with all of the calculations selected. Then you can edit the check in Check Entry and enter negative amounts for what was paid. This will ensure the employee also receives the differences in MW, RR, OP.
Is there a report that can tell us we're missing information from the check stub, such as the employee's address, that would make us non-compliant?
There is no report that just lists checks that are missing information. However, you can do one of the following:
You can export the employees by last check date to Excel to review for any missing information.
You can use the Custom option on the employee list to export to Excel all of the fields you want to check and then use the sort tools there.
We currently have manual timecards for each employee (all hourly work). Breaks are not documented but a few employees do get paid at different rates for different work performed. How are breaks paid in this case? Do we assume the breaks were taken?
If you are compensating at or above minimum wage for all hours worked, you don’t have to separate breaks. Breaks only have to be separated and paid at the regular rate of pay when there is ANY type of piece-rate compensation in the workweek. You should have clear break policies and you may want to print those on the time cards, but breaks times do not have to be specifically included on the time card.