CA AB736

Employees providing instruction at independent institutions of higher education are classified as employed in a professional capacity, exempting them from overtime and wage-hour provisions of Wage Orders 4-2001 and 5-2001 and specified Labor Code sections.

Employees must meet three criteria: employed in a professional capacity involving learned or artistic professions, paid on a salary basis, and receiving minimum compensation of either two times state minimum wage or per-course payment based on classroom hours.

Per-course compensation is calculated at $117 per classroom hour in 2020, $126 in 2021, $135 in 2022, and adjusted annually thereafter based on state minimum wage increases.

Per-course payment encompasses all classroom, laboratory, preparation, grading, office hours, and course-related work with no separate payments required; laboratory and nonlecture courses use the same minimum rates as lecture-based courses with equal units.

The act took effect immediately upon Governor approval on September 9, 2020, as an urgency statute.