California Executive Exemption (2023)

Some employees, know as “exempt” employees, are not required to be paid California minimum wage or California overtime under the law. There are 4 California employee exemptions, including an executive exemption.

Unfortunately, sometimes employees are misclassified as exempt. California employees misclassified as exempt may be entitled to additional wages, overtime, and labor code penalties — similar to California independent contractors who are misclassified.

What is California’s executive exemption?

Under California labor law, to be exempt, an executive employee in 2023 must spend the majority of their work time:

• Managing an “enterprise” or subdivision of the enterprise;
• Supervising the work of two or more other employees;
• Authorizing or giving recommendations about the employment, promotion, or termination of other employees;
• Exercising discretion and independent judgment; and
• Earning a salary of more than approximately $64,480 per year.

Employees who are commonly misclassified as exempt under California’s executive exemption include retail store managers and assistant managers.