Out-of-State Workers Due Overtime for California Work: Appeals Court

By Judy Greenwald

Dec. 14, 2011

California-based employers must pay overtime to out-of-state employees who work in California, a federal appeals court has ruled in a case involving Oracle Corp.

The 9th U.S. Circuit Court of Appeals in San Francisco court also held, however, that California-based employers do not have to pay overtime for work that is performed outside the state by out-of-state workers.

The case involving three employees of Redwood Shores, California-based Oracle, who lived in Colorado and Arizona but also worked in California and elsewhere. The employees, classified as instructors by Oracle, trained customers to use Oracle software.

The Dec. 13 ruling in Donald Sullivan et al. vs. Oracle Corp. et al. is the second time the 9th Circuit has ruled on the issue. In 2008, the appeals court withdrew a 2008 decision in the case that was essentially the same as its ruling Tuesday and asked the state Supreme Court to decide the underlying questions of California law. The California Supreme Court issued its ruling June 30.

In its decision Tuesday, the 9th Circuit agreed with the Supreme Court ruling in overturning a lower court ruling, and held that workers domiciled in other states who worked complete days in California are entitled to overtime.

“The contacts creating California interests are clearly sufficient to permit the application of California’s labor code in this case,” the three-judge appeals court panel ruled unanimously. “The employer, Oracle, has its headquarters and principal place of business in California; the decision to classify plaintiffs as teachers and to deny them overtime pay was made in California; and the work in question was performed in California.”

The appeals court’s ruling in favor of Oracle on the issue of out-of-state plaintiffs working outside of California upheld the district court’s ruling.

The case was remanded for further proceedings.

Judy Greenwald writes for Business Insurance, a sister publication of Workforce Management. To comment, email

Stay informed and connected. Get human resources news and HR features via Workforce Management’s Twitter feed or RSS feeds for mobile devices and news readers.

Judy Greenwald writes for Business Insurance, a sister publication of Workforce Management.

What’s New at

blog workforce

Come see what we’re building in the world of predictive employee scheduling, superior labor insights and next-gen employee apps. We’re on a mission to automate workforce management for hourly employees and bring productivity, optimization and engagement to the frontline.

Book a call
See the software

Related Articles

workforce blog


Minimum Wage by State in 2023 – All You Need to Know

Summary Twenty-three states and D.C. raised their minimum wage rates in 2023, effective January 1.  Thr...

federal law, minimum wage, pay rates, state law, wage law compliance

workforce blog


New Labor Laws Taking Effect in 2023

The new year is fast approaching, and with its arrival comes a host of new labor laws that will impact ...

labor laws, minimum wage, wage and hour law

workforce blog


Wage and Hour Laws in 2022: What Employers Need to Know

Whether a mom-and-pop shop with a handful of employees or a large corporation staffing thousands, compl...

compliance, wage and hour law