Clarifying Paid Sick Leave Calculations: A Recent Ruling in California

The California Court of Appeal has affirmed in Hirdman v. Charter Communications, LLC that employers can calculate paid sick leave for outside salespersons based on their base hourly pay, excluding commissions, provided they apply the same method for other paid leave. This ruling could streamline payroll for certain commissioned employees.

Bradley Hirdman, a former outside salesperson for Charter, sued under California’s Private Attorneys General Act (PAGA), alleging he was misclassified as an “exempt employee” when calculating sick leave. He argued he should have been classified as “nonexempt,” which would change the calculation method. Charter contended that Hirdman fit the “exempt employee” definition under the Labor Code’s outside salesperson exemption and that it correctly used his base hourly rate for sick pay. This is consistent with how they calculate for vacation and other paid time off. The trial court and now the Court of Appeal sided with Charter.

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