Legal Alert: California Court of Appeal Expands the Administrative Exemption Under the New Wage Orders

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In a victory for California employers, a California Court of Appeal recently rejected the traditional administrative/production dichotomy test for an administrative exempt employee for certain business models. In Combs v. Skyriver Communications, Inc. (2/7/08), the Court of Appeal affirmed the trial court?s decision dismissing the employee?s claims for overtime, unpaid meal period penalties and unpaid rest period penalties because the employee was properly classified as an administrative exempt employee. Importantly, the Court of Appeal relied heavily upon the recent changes to the Industrial Welfare Commission?s Wage Order No. 4-2001 in determining that the employee was an administrative exempt employee and, therefore, not entitled to overtime, meal periods or rest periods.

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