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Article 4. Professional, Technical, Clerical, Mechanical, and Similar Occupations (Order No. 4-98) Sec. 11040. Order Regulating Wages, Hours, and Working Conditions in Professional, Technical, Clerical, Mechanical and Similar Occupations.
Effective January 1, 1998
1. APPLICABILITY OF ORDER
This Order shall apply to all persons employed in
professional, technical, clerical, mechanical, and similar occupations whether
paid on a time, piece rate, commission, or other basis, unless such occupation is
performed in an industry covered by an industry order of this Commission, except
that:
(A) Provisions of Sections 3 through 12 shall not apply to persons employed
in administrative, executive, or professional capacities. No person shall be
considered to be employed in an administrative, executive, or professional
capacity unless one of the following conditions prevails:
(1) The employee is
engaged in work which is primarily intellectual, managerial, or creative, and
which requires exercise of discretion and independent judgment, and for which
the remuneration is not less than $1150.00 per month; or
(2) The employee is
licensed or certified by the State of California and is engaged in the practice
of one of the following recognized professions: law, medicine, dentistry,
pharmacy, optometry, architecture, engineering, teaching, or accounting, or is
engaged in an occupation commonly recognized as a learned or artistic profession;
provided, however, that registered nurses shall not be considered to be exempt
professional employees for the purposes of this subsection (2) of this order,
unless they individually meet the administrative, executive, or professional
criteria described in subsection (A)(1) above.
(B) The provisions of this Order
shall not apply to employees directly employed by the State or any county,
incorporated city or town or other municipal corporation, or to outside
salespersons.
(C) Provisions of this Order shall not apply to any individual who
is the parent, spouse, child, or legally adopted child of the employer.
2. DEFINITIONS
(A) "Commission" means the Industrial Welfare Commission of the
State of California.
(B) "Division" means the Division of Labor Standards
Enforcement of the State of California.
(C) "Professional, Technical, Clerical, Mechanical, and Similar Occupations" includes professional, semiprofessional,
managerial, supervisorial, laboratory, research, technical, clerical, office
work, and mechanical occupations. Said occupations shall include, but not be
limited to the following: accountants; agents; appraisers; artists; attendants;
audio-visual technicians; bookkeepers; bundlers; billposters; canvassers;
carriers; cashiers; checkers; clerks; collectors; communications and sound
technicians; compilers; copy holders; copy readers; copy writers; computer
programmers and operators; demonstrators and display representatives;
dispatchers; distributors; door-keepers; drafters; elevator operators;
estimators; editors; graphic arts technicians; guards; guides; hosts; inspectors;
installers; instructors; interviewers; investigators; librarians; laboratory
workers; machine operators; mechanics; mailers; messengers; medical and dental
technicians and technologists; models; nurses; packagers; photographers; porters
and cleaners; process servers; printers; proof readers; salespersons and sales
agents; secretaries; sign erectors; sign painters; social workers; solicitors;
statisticians; stenographers; teachers; telephone, radio-telephone, telegraph and
call-out operators; tellers; ticket agents; tracers; typists; vehicle operators;
x-ray technicians; their assistants and other related occupations listed as
professional, semiprofessional, technical, clerical, mechanical, and kindred
occupations.
(D) "Emergency" means an unpredictable or unavoidable occurrence at
unscheduled intervals requiring immediate action.
(E) "Employ" means to engage,
suffer, or permit to work.
(F) "Employee" means any person employed by an
employer.
(G) "Employer" means any person as defined in Section 18 of the Labor
Code, who directly or indirectly, or through an agent or any other person,
employs or exercises control over the wages, hours, or working conditions of any
person.
(H) "Hours worked" means the time during which an employee is subject to
the control of an employer, and includes all the time the employee is suffered or
permitted to work, whether or not required to do so. Within the health care
industry, the term "hours worked" means the time during which an employee is
suffered or permitted to work for the employer, whether or not required to do so,
as interpreted in accordance with the provisions of the Fair Labor Standards Act.
(I) "Minor" means, for the purpose of this Order, any person under the age of
eighteen (18) years.
(J) "Outside Salesperson" means any person, 18 years of age
or over, who customarily and regularly works more than half the working time away
from the employer's place of business selling tangible or intangible items or
obtaining orders or contracts for products, services or use of facilities.
(K)"Primarily" as used in Section 1, Applicability, means more than one-half the
employee's work time. Within the health care industry, the term "primarily" as
used in Section 1, Applicability, means (1) more than one-half the employee's work
time as a rule of thumb or, (2) if the employee does not spend over 50 percent of
the employee's time performing exempt duties, where other pertinent factors
support the conclusion that management, managerial, and/or administrative duties
represent the employee's primary duty. Some of these pertinent factors are the
relative importance of the managerial duties as compared with other types of
duties, the frequency with which the employee exercises discretionary powers, the
employee's relative freedom from supervision, and the relationship between the
employee's salary and the wages paid other employees for the kind of nonexempt
work performed by the supervisor.
(L) "Split shift" means a work schedule which
is interrupted by non-paid non-working periods established by the employer, other
than bona fide rest or meal periods.
(M) "Teaching" means, for the purpose of
Section 1 of this Order, the profession of teaching under a certificate from the
Commission for Teacher Preparation and Licensing or teaching in an accredited
college or university.
(N) "Wages" (See California Labor Code, Section 200)
(O)"Workday" means any consecutive 24 hours beginning at the same time each calendar
day.
(P) "Workweek" means any seven (7) consecutive days, starting with the same
calendar day each week. "Workweek" is a fixed and regularly recurring period of
168 hours, seven (7) consecutive 24-hour periods.
3. HOURS AND DAYS OF WORK
(A) No employee eighteen (18) years of age or over
shall be employed more than forty (40) hours in any workweek unless the employee
receives one and one-half (1 1/2) times such employee's regular rate of pay for
all hours worked over forty (40) hours in the workweek. No overtime pay shall be
required for hours of work in excess of any daily number.
(B) Provisions of
subsection (A) above shall not apply to any employee whose earnings exceed one
and one-half (1 1/2) times the minimum wage if more than half (1/2) of that
employee's compensation represents commissions.
(C) One and one-half (1 1/2)
times a minor's regular rate of pay shall be paid for all work over forty (40)
hours in any workweek except that minors sixteen (16) and seventeen (17) years
old who are not required by law to attend school and may therefore be employed
for the same hours as an adult are subject to subsection (A) above.
(VIOLATIONS
OF CHILD LABOR LAWS are subject to civil penalties of from $500 to $10,000 as
well as to criminal penalties provided herein. Refer to California Labor Code
Sections 1285 to 1311 and 1390 to 1398 for additional restrictions on the
employment of minors.)
(D) If a meal period occurs on a shift beginning or ending
at or between the hours of 10 p.m. and 6 a.m., facilities shall be available for
securing hot food or drink or for heating food or drink; and a suitable sheltered
place shall be provided in which to consume such food or drink.
(E) Except as
provided in subsections (C), (D) and (G), this section shall not apply to any
employee covered by a collective bargaining agreement if said agreement provides
premium wage rates for overtime work and a cash wage rate for such employee of
not less than one dollar ($1.00) per hour more than the minimum wage.
(F) The
provisions of this section are not applicable to employees whose hours of service
are regulated by (1) the United States Department of Transportation Code of
Federal Regulations, Title 49, Sections 395.1 to 395.13, Hours of Service of
Drivers, or (2) Title 13 of the California Code of Regulations, Subchapter 6.5,
Section 1200 and following sections, regulating hours of drivers.
(G) No employee
shall be terminated or otherwise disciplined for refusing to work more than 72
hours in any workweek, except in an emergency as defined in Section 2(D).
(H) When an employee in the health care industry requests in writing, and the
employer concurs, the employee shall be permitted to make up work time lost as a
result of personal obligations. The amount of make up time shall not exceed two
(2) hours in any one workweek and must be made up during that workweek. With the
exception of the make up time authorized in this subsection, the appropriate
overtime provisions in Section 3 shall apply to all other excess weekly hours
worked in the workweek.
4. MINIMUM WAGES
(A) Every employer shall pay to each employee wages not less
than four dollars and seventy-five cents ($4.75) per hour for all hours worked,
effective October 1, 1996; not less than five dollars ($5.00) per hour for all
hours worked, effective March 1, 1997; not less than five dollars and fifteen
cents ($5.15) per hour for all hours worked, effective September 1, 1997; and not
less than five dollars and seventy-five cents ($5.75) per hour for all hours
worked, effective March 1, 1998, except:
(1) LEARNERS. Employees 18 years of age
or over, during their first one hundred and sixty (160) hours of employment in
occupations in which they have no previous similar or related experience, may be
paid not less than eighty-five percent (85%) of the minimum wage rounded to the
nearest nickel.
(2) MINORS may be paid not less than eighty-five percent (85%) of
the minimum wage rounded to the nearest nickel provided that the number of minors
employed at said lesser rate shall not exceed twenty-five percent (25%) of the
persons regularly employed in the establishment. An employer of less than ten
(10) persons may employ three (3) minors at said lesser rate. The twenty-five
percent (25%) limitation on the employment of minors shall not apply during
school vacations.
NOTE: Under certain conditions, the full minimum wage may be
required for minors. See Labor Code Section 1391.2 (b).
(B) Every employer shall
pay to each employee, on the established payday for the period involved, not less
than the applicable minimum wage for all hours worked in the payroll period,
whether the remuneration is measured by time, piece, commission, or otherwise.
(C) When an employee works a split shift, one hour's pay at the minimum wage
shall be paid in addition to the minimum wage for that workday, except when the
employee resides at the place of employment.
(D) The provisions of this section
shall not apply to apprentices regularly indentured under the State Division of
Apprenticeship Standards.
5. REPORTING TIME PAY
(A) Each workday an employee is required to report for work
and does report, but is not put to work or is furnished less than half said
employee's usual or scheduled day's work, the employee shall be paid for half the
usual or scheduled day's work, but in no event for less than two (2) hours nor
more than four (4) hours, at the employee's regular rate of pay, which shall not
be less than the minimum wage.
(B) If an employee is required to report for work
a second time in any one workday and is furnished less than two hours of work on
the second reporting, said employee shall be paid for two hours at the employee's
regular rate of pay, which shall not be less than the minimum wage.
(C) The
foregoing reporting time pay provisions are not applicable when:
(1) Operations
cannot commence or continue due to threats to employees or property; or when
recommended by civil authorities; or (2) Public utilities fail to supply
electricity, water, or gas, or there is a failure in the public utilities, or
sewer system; or (3) The interruption of work is caused by an Act of God or other
cause not within the employer's control.
(D) This section shall not apply to an
employee on paid standby status who is called to perform assigned work at a time
other than the employee's scheduled reporting time.
6. LICENSES FOR HANDICAPPED WORKERS
A license may be issued by the Division
authorizing employment of a person whose earning capacity is impaired by physical
disability or mental deficiency at less than the minimum wage. Such licenses
shall be granted only upon joint application of employer and employee and
employee's representative if any. A special license may be issued to a nonprofit
organization such as a sheltered workshop or rehabilitation facility fixing
special minimum rates to enable the employment of such persons without requiring
individual licenses of such employees. All such licenses and special licenses
shall be renewed on a yearly basis or more frequently at the discretion of the
Division. (See California Labor Code, Sections 1191 and 1191.5.)
7. RECORDS
(A) Every employer shall keep accurate information with respect to
each employee including the following:
(1) Full name, home address, occupation
and social security number.
(2) Birthdate, if under 18 years, and designation as
a minor.
(3) Time records showing when the employee begins and ends each work
period. Meal periods, split shift intervals and total daily hours worked shall
also be recorded. Meal periods during which operations cease and authorized rest
periods need not be recorded.
(4) Total wages paid each payroll period, including
value of board, lodging, or other compensation actually furnished to the
employee.
(5) Total hours worked in the payroll period and applicable rates of
pay. This information shall be made readily available to the employee upon
reasonable request.
(6) When a piece rate or incentive plan is in operation,
piece rates or an explanation of the incentive plan formula shall be provided to
employees. An accurate production record shall be maintained by the employer.
(B)
Every employer shall semimonthly or at the time of each payment of wages furnish
each employee, either as a detachable part of the check, draft, or voucher paying
the employee's wages, or separately, an itemized statement in writing showing:
(1) all deductions; (2) the inclusive dates of the period for which the employee
is paid; (3) the name of the employee or the employee's social security number;
and (4) the name of the employer, provided all deductions made on written orders
of the employee may be aggregated and shown as one item.
(C) All required records
shall be in the English language and in ink or other indelible form, properly
dated, showing month, day and year, and shall be kept on file by the employer for
at least three years at the place of employment or at a central location within
the State of California. An employee's records shall be available for inspection
by the employee upon reasonable request.
(D) Clocks shall be provided in all
major work areas or within reasonable distance thereto insofar as practicable.
8. CASH SHORTAGE AND BREAKAGE
No employer shall make any deduction from the wage
or require any reimbursement from an employee for any cash shortage, breakage, or
loss of equipment, unless it can be shown that the shortage, breakage, or loss is
caused by a dishonest or willful act, or by the gross negligence of the employee.
[The former second sentence which was part of this section, effective January 1,
1980, was removed, effective April 24, 1989, based on a judicial determination
that it was inconsistent with California law and, therefore, invalid and
unenforceable. People v. Industrial Welfare Commission et al., Santa Cruz
Superior Court No. 85071.]
9. UNIFORMS AND EQUIPMENT
(A) When uniforms are required by the employer to be
worn by the employee as a condition of employment, such uniforms shall be
provided and maintained by the employer. The term "uniform" includes wearing
apparel and accessories of distinctive design or color.
NOTE: This section shall
not apply to protective apparel regulated by the Occupational Safety and Health
Standards Board.
(B) When tools or equipment are required by the employer or are
necessary to the performance of a job, such tools and equipment shall be provided
and maintained by the employer, except that an employee whose wages are at least
two (2) times the minimum wage may be required to provide and maintain hand tools
and equipment customarily required by the trade or craft. This subsection (B)
shall not apply to apprentices regularly indentured under the State Division of
Apprenticeship Standards.
NOTE: This section shall not apply to protective
equipment and safety devices on tools regulated by the Occupational Safety and
Health Standards Board.
(C) A reasonable deposit may be required as security for
the return of the items furnished by the employer under provisions of subsections
(A) and (B) of this section upon issuance of a receipt to the employee for such
deposit. Such deposits shall be made pursuant to Section 400 and following of the
Labor Code or an employer with the prior written authorization of the employee
may deduct from the employee's last check the cost of an item furnished pursuant
to (A) and (B) above in the event said item is not returned. No deduction shall
be made at any time for normal wear and tear. All items furnished by the employer
shall be returned by the employee upon completion of the job.
10. MEALS AND LODGING
(A) "Meal" means an adequate, well-balanced serving of a
variety of wholesome, nutritious foods.
"Lodging" means living accommodations
available to the employee for full-time occupancy which are adequate, decent, and
sanitary according to usual and customary standards. Employees shall not be
required to share a bed.
(B) Meals or lodging may not be credited against the
minimum wage without a voluntary written agreement between the employer and the
employee. When credit for meals or lodging is used to meet part of the employer's
minimum wage obligation, the amounts so credited may not be more than the
following:
Effective January 1, 1998 |
Effective March 1, 1998 |
| Room occupied alone |
$24.25 per week
|
$27.05 per week
|
| Room shared
|
$20.00 per week
|
$22.30 per week
|
| Apartment--two-thirds (2/3) of the ordinary
rental value, and in no event more than
|
$290.80 per month
|
$324.70 per month
|
| Where a couple are both employed by the
employer, two-thirds (2/3) of the ordinary
rental value, and in no event more than
|
$430.20 per month |
$480.30 per month |
Meals:
Breakfast
Lunch
Dinner
| $1.80
$2.55
$3.40 |
$2.05
$2.85
$3.80 |
(C) Meals evaluated as part of the minimum wage must be bona fide
meals consistent with the employee's work shift. Deductions shall not be made for
meals not received nor lodging not used.
(D) If, as a condition of employment,
the employee must live at the place of employment or occupy quarters owned or
under the control of the employer, then the employer may not charge rent in
excess of the values listed herein.
11. MEAL PERIODS
(A) No employer shall employ any person for a work period of
more than five (5) hours without a meal period of not less than thirty (30)
minutes, except that when a work period of not more than six (6) hours will
complete the day's work the meal period may be waived by mutual consent of
employer and employee. Unless the employee is relieved of all duty during a
thirty (30) minute meal period, the meal period shall be considered an "on duty"
meal period and counted as time worked. An "on duty" meal period shall be
permitted only when the nature of the work prevents an employee from being
relieved of all duty and when by written agreement between the parties an
on-the-job paid meal period is agreed to.
(B) In all places of employment where
employees are required to eat on the premises, a suitable place for that purpose
shall be designated.
(C) Notwithstanding any other provision of this order,
employees who work shifts in excess of eight (8) total hours in a workday may
voluntarily waive their right to a meal period. In order to be valid, any such
waiver must be documented in a written agreement that is voluntarily signed by
both the employee and the employer. The employee may revoke the waiver at any
time by providing the employer at least one day's written notice. The employee
shall be fully compensated for all working time, including any on-the-job meal
period, while such a waiver is in effect.
12. REST PERIODS
Every employer shall authorize and permit all employees to take
rest periods, which insofar as practicable shall be in the middle of each work
period. The authorized rest period time shall be based on the total hours worked
daily at the rate of ten (10) minutes net rest time per four (4) hours or major
fraction thereof. However, a rest period need not be authorized for employees
whose total daily work time is less than three and one-half (3 1/2) hours.
Authorized rest period time shall be counted as hours worked for which there
shall be no deduction from wages.
13. CHANGE ROOMS AND RESTING FACILITIES
(A) Employers shall provide suitable
lockers, closets, or equivalent for the safekeeping of employees' outer clothing
during working hours, and when required, for their work clothing during
nonworking hours. When the occupation requires a change of clothing, change rooms
or equivalent space shall be provided in order that employees may change their
clothing in reasonable privacy and comfort. These rooms or spaces may be adjacent
to but shall be separate from toilet rooms and shall be kept clean and sanitary.
NOTE: This section shall not apply to change rooms and storage facilities
regulated by the Occupational Safety and Health Standards Board. (B) Suitable
resting facilities shall be provided in an area separate from the toilet rooms
and shall be available to employees during work hours.
14. SEATS
(A) All working employees shall be provided with suitable seats when
the nature of the work reasonably permits the use of seats.
(B) When employees
are not engaged in the active duties of their employment and the nature of the
work requires standing, an adequate number of suitable seats shall be placed in
reasonable proximity to the work area, and employees shall be permitted to use
such seats when it does not interfere with the performance of their duties.
15. TEMPERATURE
(A) The temperature maintained in each work area shall provide
reasonable comfort consistent with industry-wide standards for the nature of the
process and the work performed.
(B) If excessive heat or humidity is created by
the work process, the employer shall take all feasible means to reduce such
excessive heat or humidity to a degree providing reasonable comfort. Where the
nature of the employment requires a temperature of less than 60° F., a heated
room shall be provided to which employees may retire for warmth and such room
shall be maintained at not less than 68°.
(C) A temperature of not less than 68°
shall be maintained in the toilet rooms, resting rooms, and change rooms during
hours of use.
(D) Federal and State energy guidelines shall prevail over any
conflicting provision of this section.
16. ELEVATORS
Adequate elevator, escalator
or similar service consistent with industry-wide standards for the nature of the
process and the work performed shall be provided when employees are employed four
floors or more above or below ground level.
17. EXEMPTIONS
If, in the opinion of the Division after due investigation, it is
found that the enforcement of any provision contained in Section 7, Records;
Section 11, Meal Periods; Section 12, Rest Periods; Section 13, Change Rooms and
Resting Facilities; Section 14, Seats; Section 15, Temperature; or Section 16,
Elevators, would not materially affect the welfare or comfort of employees and
would work an undue hardship on the employer, exemption may be made at the
discretion of the Division. Such exemptions shall be in writing to be effective
and may be revoked after reasonable notice is given in writing. Application for
exemption shall be made by the employer or by the employee and/or the employee's
representative to the Division in writing. A copy of the application shall be
posted at the place of employment at the time the application is filed with the
Division.
18. FILING REPORTS
(See California Labor Code, Section 1174(a))
19. INSPECTION
(See California Labor Code, Section 1174)
20. PENALTIES
(See California Labor Code, Section 1199)
21. SEPARABILITY
If the application of any provision of this Order, or any
section, subsection, subdivision, sentence, clause, phrase, word, or portion of
this Order should be held invalid or unconstitutional or unauthorized or
prohibited by statute, the remaining provisions thereof shall not be affected
thereby, but shall continue to be given full force and effect as if the part so
held invalid or unconstitutional had not been included herein.
22. POSTING OF ORDER
Every employer shall keep a copy of this Order posted in an
area frequented by employees where it may be easily read during the work day.
Where the location of work or other conditions make this impractical, every
employer shall keep a copy of this Order and make it available to every employee
upon request.
EXCERPTS FROM THE LABOR CODE
Section 200. As used in this article: (a) "Wages"
includes all amounts for labor performed by employees of every description,
whether the amount is fixed or ascertained by the standard of time, task, piece,
commission basis, or other method of calculation.
Section 201. If an employer discharges an employee, the wages earned and unpaid
at the time of discharge are due and payable immediately.
Section 202. If an employee not having a written contract for a definite period
quits his employment, his wages shall become due and payable not later than 72
hours thereafter, unless the employee has given 72 hours previous notice of his
intention to quit, in which case the employee is entitled to his wages at the
time of quitting.
Section 226. (a) Every employer shall semimonthly, or at the time of each payment
of wages, furnish each of his or her employees either as a detachable part of the
check, draft, or voucher paying the employee's wages, or separately when wages
are paid by personal check or cash, an itemized statement in writing showing: (1)
gross wages earned; (2) total hours worked by each employee whose compensation is
based on an hourly wage; (3) all deductions; provided, that all deductions made
on written orders of the employee may be aggregrated and shown as one item; (4)
net wages earned; (5) the inclusive dates of the period for which the employee is
paid; (6) the name of the employee and his or her social security number; and (7)
the name and address of the legal entity which is the employer.
Section 1174. Every person employing labor in this state shall: (a) Furnish to
the commission, at its request, reports or information which the commission
requires to carry out this chapter. Such reports and information shall be
verified if required by the commission or any member thereof. (b) Allow any
member of the commission or the employees of the Division of Labor Standards
Enforcement free access to the place of business or employment of such person to
secure any information or make any investigation which they are authorized by
this chapter to ascertain or make. The commission may inspect or make excerpts,
relating to the employment of employees, from the books, reports, contracts,
payrolls, documents, or papers of such person.
Section 1191. For any occupation in which a minimum wage has been established,
the commission may issue to an employee who is mentally or physically
handicapped, or both, a special license authorizing the employment of the
licensee for a period not to exceed one year from date of issue, at a wage less
than the legal minimum wage. The commission shall fix a special minimum wage for
the licensee. Such license may be renewed on a yearly basis.
Section 1191.5. Notwithstanding the provisions of Section 1191, the commission
may issue a special license to a nonprofit organization such as a sheltered
workshop or rehabilitation facility to permit the employment of employees who
have been determined by the commission to meet the requirements in Section 1191
without requiring individual licenses of such employees. The commission shall fix
a special minimum wage for such employees. The special license for the nonprofit
corporation shall be renewed on a yearly basis, or more frequently as determined
by the commission.
Section 1199. Every employer or other person acting either individually or as an
officer, agent, or employee of another person is guilty of a misdemeanor and is
punishable by a fine of not less than one hundred dollars ($100) or by
imprisonment for not less than 30 days, or by both, who does any of the
following: (a) Requires or causes any employee to work for longer hours than
those fixed, or under conditions of labor prohibited by an order of the
commission. (b) Pays or causes to be paid to any employee a wage less than the
minimum fixed by an order of the commission. (c) Violates or refuses or neglects
to comply with any provision of this chapter or any order or ruling of the
commission.
Section 1391.2. (a) Notwithstanding Sections 1391 and 1391.1, any
minor under 18 years of age who has been graduated from a high school maintaining
a four-year course above the eighth grade of the elementary schools, or who has
had an equal amount of education in a private school or by private tuition, or
who has been awarded a certificate of proficiency pursuant to Section 48412 of
the Education Code, may be employed for the same hours as an adult may be
employed in performing the same work. (b) Notwithstanding the provisions of the
orders of the Industrial Welfare Commission, no employer shall pay any minor
described in this section in his employ at wage rates less than the rates paid to
adult employees in the same establishment for the same quantity and quality of
the same classification of work; provided, however, that nothing herein shall
prohibit a variation of rates of pay for such minors and adult employees engaged
in the same classification of work based upon a difference in seniority, length
of service, ability, skill, difference in duties or services performed, whether
regularly or occasionally, difference in the shift or time of day worked, hours
of work, or other reasonable differentiation, when exercised in good faith.
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