California Labor Compliance

To remain compliant with the regional labor requirements for restaurants, employers in California must take certain measures to ensure they are scheduling in a compliant manner.

Enabling Labor Compliance
Types of Exceptions
Missed Break Waivers
Exception Warnings
Automatically Dismiss Missed Meal Breaks
Employee Attestation
Custom Attestation
Reporting Pay
Exception Report
⚠️ Access to certain features may require an upgrade from your current plan.
⚠️ The Labor Exceptions report is only available with 7punches or a POS labor integration.

To enable Labor Compliance

1. Head to Settings > Company Settings > Labor & Compliance.

2. Under the Jurisdiction dropdown > choose California.

3. California labor compliance settings will automatically populate. You can choose to manually adjust the settings at the bottom of the page and remember to click 'Save.'

4. For accounts that select 'California' as their jurisdiction, the overtime calculations in 7shifts are automatically set to 'Regular Rate of Pay.'

⚠️ On July 15, 2021, the California Supreme Court ruled that overtime must be paid at the regular rate of pay—a weighted pay rate versus solely the hours worked.

Click here to learn more about the 'Regular Rate of Pay' option in your Overtime settings.

Regular rate of pay is calculated as a weighted average of all the shifts an employee has worked multiplied by the wage paid for each hour (from all Roles, across all Departments/Locations), divided by the total hours worked in a period. For example: if an employee worked 30 hours at $10, and 30 hours at $20, the regular rate of pay is $15/hour.

5. To re-sync your settings to California defaults (including the Overtime rules) click the 'Re-sync labor & compliance settings' button.

Types of Exceptions

Missed Meal Breaks

Meal breaks are breaks of 30 minutes or more.  Depending on the length of shift, 1 or 2 meal breaks may be required. An exception occurs when the required number of meal breaks are not taken and/or if Meal Break #1 is not started before the end of the 5th hour (4:59) of the shift. For each exception, an employee should be rewarded with 1 hour of pay at the regular rate of pay. 7shifts checks the time punch records to determine if the required breaks were taken on each shift. For more details please review the State of California website.


Missed Rest Breaks

Rest Breaks are breaks of at least 10 consecutive minutes and must be paid breaks.  Depending on the length of shift, 1-4 rest breaks may be required. A break that was counted as a Meal Break, CANNOT also be counted as a Rest Break. An exception occurs when the required number of Rest Breaks are not taken. For each exception, an employee should be rewarded with 1 hour of pay at the regular rate of pay. For more details please review the State of California website.


Split Shift

An exception occurs if an employee has two punches, in the same day, separated by 60 minutes or more. For each exception, an employee is entitled to one hour of premium pay at the rate of the minimum wage. This premium pay can be offset if the employee's wage is higher than the minimum wage.  For more details please review the State of California website

Missed Break Waivers

If an Employee has a missed Meal Break waiver on file, this will be shown in the punch modal. You can indicate in an Employee's profile whether they have signed a waiver for ' 6hrs & out' and '10hrs & out'

Dismissing a Rest Break can not be done using a waiver, and must use Employee Attestation each time a break is missed. 

1. To enable this feature, go to Company Settings > Labor & Compliance > enable 'Meal Breaks' > enable waivers.

2. Then, navigate to the  Team > Employee profile > Employment tab to indicate whether that Employee has signed their waiver:

These indications are then shown in the punch edit modal for that Employee:

Skip to here for more information on dismissing exception warnings for missed breaks.

Exception Warnings

While scheduling

To avoid or reduce labor exceptions you will be warned about potential exceptions as you make changes to your schedule. Each time you make a change to a shift that may cause one or more exceptions, a warning will appear indicating the type of exception and the associated cost. 

Before publishing a schedule, you will see a warning summary showing the number of exceptions, the total cost, and details of each exception. 

You will also see a warning when assigning shifts through the Shift Pool that may cause an exception. 

Within the Punch Edit Screen (when using 7punches)

Exceptions for missed breaks and split shifts will show on the left side of the punch. 

If an Employee misses a Meal Break or a Rest Break, these exceptions can be dismissed from within the punch modal.

To dismiss the missed break exceptions based on Employee waivers, click on the break and then 'Dismiss Exception'.

⚠️ Dismissing a Rest Break can not be done using a waiver, and must use Employee Attestation each time a break is missed.

The exception warning will then be faded /ignored. You can restore the exception by clicking on it again, then 'Restore Exception'.

Click here to view all 7punches settings. 

Automatically Dismiss Missed Meal Breaks

Reduce the time needed to perform payroll with automated meal break warnings! If an Employee misses their meal break, it will automatically be dismissed on your Time Clocking page.

⚠️ This feature is only available for those using 7punches and may require an upgrade from your current plan.

⚠️ Only Admins can access Company Settings to enable this feature.

⚠️ Assistant Managers/Managers with permissions can access this feature. These include: 'Can manage punches', 'can manage exceptions', 'can add employees', and 'can edit employees'.


How to Enable 'Automatically Dismiss Missed Meal Breaks' 

To enable 'Automatically Dismiss Missed Meal Breaks", the following settings must first be enabled in Settings > Company Settings > Labor & Compliance > see section Advanced Labor:

  • Attestation
  • Meal Break Waivers
From Company Settings
  1. In the left navigation bar, select Settings Company Settings. Once on the Company Settings page, select Labor & Compliance
  2. Under the section Advanced Labor > checkmark Automatically dismiss missed meal breaks to enable it:

  3. Click Save to complete these changes
From an Employee Profile
  1. In the left navigation bar, select Team > Employees > search for an Employee and click on their name to expand it. Once on the Employee profile, select Employment on the left-hand menu.
  2. Checkmark the waiver(s) on file that will apply to the Employee:

  3. Click Save to complete these changes

How to 'Revert Auto-dismissed Meal Breaks'

From the Time Clocking page
  1. In the left navigation bar, click on the Time Clocking tab and select a pay period. Once the pay period has expanded, click on the pencil icon Screen_Shot_2022-10-28_at_9.54.21_PM.png next to the punch you would like to edit.

  2. In the Punch Overviewclick on Auto-dismissed meal break:Screen_Shot_2022-10-28_at_10.00.14_PM.png
  3. Click Revert auto-dismissed meal break to accept the warning:Screen_Shot_2022-10-28_at_10.03.16_PM.png
  4. Click Save to complete these changes

When you're ready to review this information, you can navigate to your Punch Audit Report, set your filters, and click 'Get Report'.

Automatically dismissed meal breaks in reports

Automatically dismissed meal breaks' will appear for each Employee within the specified date range as:


If a punch has been edited, this will render the auto-dismissed meal break as obsolete, and it will be recorded in the report as :


Employee Attestation

⚠️ Employee Attestation is only for those using the 7punches mobile app, and may require an upgrade from your current plan.

Through 7punches, Employee Attestation will require Employees to confirm whether they:

  • Took their breaks in accordance with the policy
  • Had the opportunity to take all of their breaks, but freely chose not to
  • Were prevented from taking their breaks

Attestation occurs on employee punch out. This data will be available in the Labor Exceptions report, accessible to Managers and Admins.

To enable Employee Attestation: 

1. Go to Settings > Labor & Compliance > select Jurisdiction (California) 

2. Scroll further down, select 'Attestation', and click 'Save'.

In the 'Policy Link' field, there is the option to directly link your company's break policy so your employees can access it on the Attestation modal when they punch out.


On Employee Punch-out

Once an Employee punches out, they will be prompted to attest to their breaks. They can toggle between languages (English and Spanish) from the dropdown in the top right corner:

Attestation Customization:

⚠️ Access to this feature may require an upgrade from your current plan.

Admins and Managers will have the option to Customize Attestation fields:

  • Choosing the Attestation question
  • Choosing the answers to the Attestation question
  • Number of Attestation answers (2 or 3)
  • Language
To enable Custom Attestation:

1. Go to Settings > Company Settings > Labor & Compliance.

2. In the Jurisdiction dropdown > select 'California.'

3. Check the option 'Attestation' further down.

4. Click on 'Customize Attestation.'

5. Under each tab, enter the applicable details for your custom questions and responses. 

❗️The Negative Response field must be filled out, as well as at least one Affirmative Response (positive), for Employees to select when they punch out.

6. Remember to click 'Save.'

Reporting Pay

Reporting Pay is a form of wages that compensates employees who are scheduled to report to work and are sent home before the conclusion of their scheduled shift. These employees are entitled to be paid for unworked hours.

In California, employees who worked half or less than half of their scheduled shift are entitled to be paid for half of their scheduled shift’s hours (at their regular rate of pay). Employees must be paid no less than two hours and no more than four hours.

For example: If an employee is scheduled for an 8-hour shift and works 4 hours or less, they are entitled to 4 hours of pay. If an employee is scheduled for a 3-hour shift and works 1.5 hours or less, they are entitled to 2 hours of pay.

⚠️  Reporting pay may require an upgrade from your current plan.

⚠️ Managers/Assistant Managers require the following permissions to have visibility on this feature: ‘Can manage time punches’, ‘Can manage exceptions’, and ‘Can run reports’.

⚠️ Reporting pay hours do not contribute to the calculation of hours worked, such as overtime hours.

⚠️ If rounding rules have been enabled for 7punches, this may affect shifts eligible for Reporting Pay and the costs associated.

To enable Reporting Pay

  1. Login as an Admin.

  2. In the left navigation bar, select Settings > Company Settings. Once on the Company Settings page, select the 'Labor & Compliance' tab:

  3. Under the section 'Advanced Labor', enable 'Reporting Pay':

  4. Be sure to hit 'Save' to complete these changes!
Once Reporting Pay has been enabled, it will automatically appear for Admins and Managers in the following areas...

1. On the Time Clocking page as an exception warning.


2. On a Punch Overview.


Admins and Managers/Assistant Managers (with permissions) can click on the warning to further dismiss/restore an exception warning:

3. The Worked Hours and Wages Report.

Similarly, you can export the report directly from a closed timesheet:


4. The Labor Exceptions Report.


5. The Punch Audit Report, when the exception has been dismissed.


Exceptions Report

⚠️ Missed Breaks Exceptions will only show on the Labor Exceptions report for those using 7punches or select POS labor integrations, including: 
  • Toast
  • Micros 3700
  • Aloha
  • Squirrel
  • Heartland Restaurant
  • Brink

1. Go to Reports > Labor Exceptions.

2. Select the 'Date Range' and 'Location' and click 'Get Report.'

Included in the report:

  • Employee who incurred the exception
  • Location where the exception took place
  • Date of the exception
  • Shift length
  • Exception type 
  • Attestation response
  • Exception cost
  • Waivers on file

To better understand how meal breaks are automatically dismissed, here are the conditions that need to be met:

The First Meal Break Auto-dismissal:

If an employee hasn't taken their first meal break within the first 5 hours of their shift, the system can automatically dismiss the missed meal break if:

  • The Employee has a Meal Break 1 waiver on file.
  • The shift is less than or equal to 6 hours.

The Second Meal Break Auto-dismissal:

If an employee has already taken their first meal break within the first 5 hours of their shift and meets the conditions below, the system can automatically dismiss a missed second meal break.

  • The first meal is not auto-dismissed but taken within the first 5 hours of the worked shift.
  • The employee who hasn't already had a meal break is automatically dismissed for that shift.
  • The employee worked a shift between 10 to 12 hours.
  • If the shift is longer than 12 hours, the system won't dismiss any missed meal breaks.
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