Running the Business · Part 6
Employees: wage and hour, overtime, meal and rest periods, final-pay rules, and the workers' compensation class code
The first employee brings a body of law that a plumbing contractor runs into every single day: the minimum wage where the work is done, daily overtime after eight hours, the meal period before the end of the fifth hour, the ten-minute rest every four hours, the premium hour owed for each missed break, the final check due the day someone is fired, and the wage statement that has to show all of it. This lesson is the working rules with the section for each, the timekeeping that proves compliance, the final-pay clock that catches almost every new employer, and the workers' compensation class code that decides what a plumbing payroll costs to insure.
What the full lesson covers
- Minimum wage is $16.90 per hour statewide in 2026 and higher in many cities; the rate where the work is performed applies (Labor Code 1182.12). Overtime is daily: time and a half after eight hours in a day and after forty in a week, double time after twelve (Labor Code 510). Construction has no exemption.
- Meal period: 30 minutes, unpaid, off duty, before the end of the fifth hour; second one before the end of the tenth (Labor Code 512). Rest: ten minutes paid per four hours or major fraction (Wage Order 16). Each missed period is one extra hour of pay for that day (Labor Code 226.7).
- Final pay: immediately on termination (Labor Code 201); within 72 hours of a quit, or on the last day with 72 hours' notice (202); willful lateness continues the wages as a penalty up to 30 days (203). Have the check ready when you have the conversation.
- Timekeeping is the employer's burden: start, stop, and meal times daily, kept; the wage statement under Labor Code 226 every payday; the 2810.5 notice at hire; paid sick leave accrual (Labor Code 246); expense reimbursement for the personal phone and the personal truck (Labor Code 2802).
- Workers' compensation premium is payroll times the class rate; plumbing is WCIRB class 5183, and misreporting payroll into a cheaper class is fraud the carrier's audit finds.
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More lessons in Growing the Business
- 1Hiring under AB 5: the ABC test, why a 1099 helper is a lawsuit unless they hold their own license, and the construction subcontract exemption
- 2Employees: wage and hour, overtime, meal and rest periods, final-pay rules, and the workers' compensation class codeYou are here
- 3Apprentices and the Division of Apprenticeship Standards: how a small shop trains its next plumber lawfully
- 4Adding classifications: when to add the B, the C-20, or a second specialty, and how the exam waiver works
- 5Systems: field-service software, the price book, and dispatch. What to buy, when, and what it must produce
- 6KPIs: average ticket, close rate, gross margin, and the three numbers that predict failure
- 7Supply-house credit at scale, the fleet, and inventory: the second truck's paperwork and the parts on it
- 8Becoming an RMO for someone else's company: the liability you are taking on, and the only version that is lawful
- 9Selling or stepping back: what a plumbing business is worth, what a buyer is actually buying, and what the license will and will not let you transfer
- 10Template: the hiring checklist (AB 5-safe), from the decision to the first day
- 11Template: the new-hire packet index
- 12Template: the monthly KPI sheet