Drivers are essential to California’s economy, moving goods and people across the state and throughout the country. 

When employers with drivers ask me about California wage and hour compliance, I tell them upfront that this is one of the most complex regulatory areas any employer can operate in, and that the answers to most wage and hour questions almost always depend on details about the driver, the vehicle, and the route. So, when I sat down to write this post, I called Tim Nelson, who is a co-leader of the Wage and Hour Practice Group at Medina McKelvey LLP and works with employers across California, to make sure I got it right. 

Tim put it this way: “Commercial driving is one of the few areas where two sets of wage and hour rules can apply at the same time, and where the answer to a basic question like whether a driver is entitled to a meal break can turn on the weight of the vehicle and whether the driver is subject to federal Hours of Service regulations. Employers who treat this as a one-size-fits-all problem are the ones who end up defending class and PAGA claims.” 

This post provides a basic overview of the rules as they apply to drivers, highlights key differences between federal and California law, and offers practical guidance for employers. 

Federal Laws Governing Drivers 

Drivers operating across state lines are subject to federal regulations that often intersect with California’s wage and hour laws, creating a complex compliance landscape. 

The Fair Labor Standards Act (FLSA) sets minimum wage and overtime standards, but there is an overtime exception (29 U.S.C. § 213(b)(1)) for drivers affecting the safety of motor vehicles in interstate commerce, such as those crossing state lines or hauling goods for out-of-state delivery, from federal overtime rules. This exception doesn’t apply to non-drivers (e.g., loaders) or drivers whose work involves vehicles with a gross vehicle weight rating of 10,000 pounds or less under the small vehicle exception established by the SAFETEA-LU Technical Corrections Act of 2008, who remain entitled to FLSA protections. 

For example, a driver hauling freight from San Diego to Nevada falls under the exception, but a local delivery driver using a small van likely does not. 

The Department of Transportation (DOT) also enforces Hours of Service (HOS) regulations (49 CFR Part 395) to ensure highway safety. Property-carrying drivers may not drive more than 11 hours within a 14-hour on-duty window after 10 consecutive hours off duty. They must take a 30-minute break after 8 hours of driving and may use a 34-hour restart to reset weekly limits. Short-haul drivers operating within 100 air miles have modified rules, such as a 12-hour on-duty window. 

These federal rules often conflict with California’s stricter standards, which requires employers to carefully distinguish between interstate and intrastate operations to ensure compliance. 

California Wage and Hour Laws for Drivers 

California’s robust wage protections apply to drivers unless preempted by federal law, creating a layered compliance challenge for employers. 

Most drivers are governed by Industrial Welfare Commission (IWC) Wage Order 9.  According to Wage Order 9, nonexempt drivers are entitled to a minimum wage of $16.90 per hour effective January 1, 2026 (up from $16.50 in 2025), per the Department of Industrial Relations. Many California cities and counties have higher local minimum wages, and employers must apply the highest rate that applies to where the driver actually works. 

Overtime is required at 1.5 times the regular rate of pay for hours over 8 in a day or 40 in a week, and double time for hours over 12 in a day or 8 on the seventh consecutive day, per Labor Code § 510.  Wage Order 9 contains an exemption from California’s overtime requirements if the driver’s 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 the following sections, regulating hours of drivers. 

For a driver making deliveries within Los Angeles, this means the employer must include performance bonuses in the regular rate of pay when calculating overtime, ensuring fair pay for long shifts. 

Intrastate drivers, meaning those operating solely within California and not subject to federal Hours of Service regulations, are entitled to meal and rest breaks under Wage Order 9. 

• A 30-minute unpaid, duty-free meal break must start before the 5th hour for shifts over 5 hours, with a second meal break before the 10th hour for shifts over 10 hours. 

• Additionally, 10-minute paid, duty-free rest breaks are required for every 4 hours worked or major fraction thereof (e.g., two breaks for an 8-hour shift), ideally in the middle of each work period. 

• Drivers must be relieved of all duties during these breaks and must be free to leave the vehicle. 

California also mandates paid sick leave (Labor Code § 246), accurate wage statements (Labor Code § 226), and expense reimbursements (Labor Code § 2802) for costs like fuel, tolls, vehicle maintenance, and cell phone use. 

Additionally, the passage of AB 5 (Labor Code § 2775) has reshaped driver classification. Under its ABC test, drivers are presumed employees unless the hiring entity can show all three of the following: 

1. The driver is free from the hiring entity’s control and direction. 

2. The driver performs work outside the hiring entity’s usual course of business. 

3. The driver is engaged in an independently established trade, occupation, or business of the same nature as the work performed. 

Owner-operators with their own companies and multiple clients may qualify for the business-to-business exemption (Labor Code § 2776), but most drivers working for a single hiring entity must be treated as employees, gaining access to these protections. 

The Preemption Issue: Federal vs. State Rules 

The interplay between federal and California wage and hour laws creates significant complexity, particularly for meal and rest breaks.  

In December 2018, the Federal Motor Carrier Safety Administration (FMCSA) ruled that California’s meal and rest break rules are preempted for property-carrying commercial motor vehicle drivers subject to federal Hours of Service regulations, and in January 2020 the agency extended that preemption to passenger-carrying drivers. 

In 2021, the Ninth Circuit upheld the 2018 determination in International Brotherhood of Teamsters, Local 2785 v. FMCSA, and the California Court of Appeal in Espinoza v. Hepta Run, Inc. (2022) confirmed the preemption applies to short-haul as well as long-haul property-carrying drivers covered by federal Hours of Service regulations. 

In November 2023, California petitioned the FMCSA to waive the preemption determinations, but as of mid-2026 the FMCSA has not acted on the petition, and the preemption decision remains in force. 

This means a driver hauling goods from Oakland to Nevada is required to follow federal HOS rules (e.g., a 30-minute break after 8 hours of driving) instead of California’s stricter meal and rest break requirements. 

The preemption does not apply, however, to drivers who are not subject to federal Hours of Service regulations, such as a driver who operates a small delivery vehicle within Sacramento that falls below the federal weight thresholds. A driver in that situation is subject to California wage and hour rules and must receive a 30-minute meal break before the end of the fifth hour of work and 10-minute rest breaks for every four hours worked, per Wage Order 9. 

Importantly, the FLSA’s overtime exception doesn’t preempt California’s overtime or minimum wage laws. Even interstate drivers must earn at least $16.90 per hour in 2026 (or the higher applicable local rate) and overtime per Wage Order 9, unless another exemption applies. 

Employers must carefully analyze each driver’s vehicle type, routes, and operational classification to determine whether federal or state rules govern, as misapplication can lead to costly violations. 

Key Considerations for Employers in California 

Navigating wage and hour compliance for drivers requires careful attention to the distinctions between interstate and intrastate operations, as well as employee classification. 

• Interstate drivers (crossing state lines) are generally exempt from California’s meal and rest break rules when they operate property-carrying or passenger-carrying commercial motor vehicles subject to federal Hours of Service regulations, under the FMCSA preemption determinations issued in 2018 and 2020 and confirmed by courts. However, they must still receive California’s minimum wage ($16.90 per hour in 2026, or any higher applicable local rate) and overtime (1.5x after 8 hours/day or 40 hours/week, double time after 12 hours/day or 8 on the seventh day), as the FLSA Motor Carrier Exemption doesn’t preempt state law, unless a California-specific overtime exception applies. 

• Intrastate drivers who are not subject to federal Hours of Service regulations are generally subject to Wage Order 9’s break and overtime rules, ensuring duty-free breaks and fair pay for long hours, unless a California-specific overtime exception applies. 

Another example:A driver hauling produce from Los Angeles to Phoenix likely falls under federal rules and likely would not be entitled to California meal/rest breaks. A driver making local deliveries within Sacramento in a vehicle that is not a commercial motor vehicle subject to federal Hours of Service rules, however, is likely entitled to California’s stricter protections. 

Employee vs. Independent Contractor Status 

AB 5 has reshaped driver classification across industries by making it harder to classify drivers as independent contractors. Under the ABC test, drivers are presumed to be employees unless the company can show they are free from control, perform work outside the usual business of the hiring entity, and operate as an independent business. 

For example, a large company that hires drivers to move freight or passengers as part of its core business is unlikely to meet the ABC test, meaning those drivers must be treated as employees. By contrast, an owner-operator running their own logistics company with multiple clients may still qualify as an independent contractor. 

Overtime Calculations 

Even when drivers are exempt from FLSA overtime under the FLSA exceptions for motor carriers, California law may still require overtime pay. Employers must evaluate whether the driver’s work is interstate or intrastate and whether Wage Order 9 applies. 

Expense Reimbursement 

California law also requires reimbursement for necessary business expenses. For drivers, this often includes fuel advances, tolls, parking fees, and use of personal cell phones for dispatch. 

Risks of Noncompliance 

Noncompliance with California’s wage and hour laws for drivers can lead to severe consequences, particularly given how frequently driver-related operations appear in California wage and hour litigation. 

For example, Central Valley Trucking, a Fresno-based company with 20 drivers,classified its intrastate drivers as independent contractors, and failed to provide meal breaks or overtime as a result. This led to a PAGA lawsuit based on an allegation that these drivers were misclassified, with penalties under Labor Code § 2699 that, after the 2024 PAGA reforms, can range from $100 per pay period for certain wage statement violations up to $200 per pay period for malicious or repeat violations, plus back wages and legal fees. 

Disruption from PAGA lawsuits can strain customer service, erode driver trust, and pull leadership attention away from the operational work that customers depend on. 

Violations like unpaid overtime, missed breaks for drivers not covered by federal Hours of Service preemption decisions, or unreimbursed expenses (e.g., fuel, tolls) can trigger class or PAGA claims, amplifying liability across entire fleets. 
 
The 2024 PAGA reforms (AB 2288, SB 92) offer some relief, allowing small employers with fewer than 100 employees to submit a confidential cure proposal to the Labor and Workforce Development Agency within 33 days of receiving a PAGA notice. Employers of any size that demonstrate they took all reasonable steps to comply with the Labor Code before the PAGA notice was served can also have penalties capped at 15 percent of what would otherwise apply. 

That’s why it is important for employers operating in California to prioritize accurate pay, breaks, and classifications, to protect the drivers who serve their customers every day and build stable, compliant operations. 

Best Practices for Transportation Employers 

To ensure compliance with California’s complex wage and hour laws for drivers, employers should consider these best practices: 

1. Determine Driver Coverage: Identify which drivers are subject to federal Hours of Service regulations under the Federal Motor Carrier Safety Administration (and therefore potentially covered by the FMCSA’s meal and rest break preemption decisions) versus those covered solely by Wage Order 9 to apply correct overtime and break rules; also identify which drivers might be covered by the overtime exceptions listed in Wage Order 9. 

2. Review Classification: Apply AB 5’s ABC test (Labor Code § 2775) and verify eligibility for the business-to-business exemption (Labor Code § 2776), consulting legal counsel. 

3. Audit Pay Practices: Ensure drivers earn at least $16.90 per hour in 2026 (or the higher applicable local rate), including waiting/non-driving time, and calculate overtime using the regular rate of pay, per Labor Code § 510. 

4. Reimburse Expenses: Document and reimburse reasonable expenses (e.g., fuel, tolls, maintenance, cell phones), per Labor Code § 2802. 

5. Update Policies: Develop written policies reflecting federal preemption decisions for drivers covered by federal Hours of Service regulations and California break rules for drivers not covered by the preemption decisions, training managers accordingly. 

6. Maintain Records: Keep wage statements, hours logs, break records (for drivers covered by Wage Order 9), and expense reimbursements for at least three years under Labor Code §§ 226 and 1174, and consider retaining for four years to align with the statute of limitations for underlying wage claims brought through California’s unfair competition law. 

7. Leverage PAGA Reforms: Take advantage of the 2024 PAGA reforms (AB 2288, SB 92) by auditing payroll and time tracking records, improving policies and practices, and training employees, supervisors, and managers, and potentially curing violations to improve the chances of a reduction in penalties in PAGA cases. 

Final Thoughts 

Wage and hour compliance for drivers is uniquely complex because of the overlap between federal and state laws. The distinction between interstate and intrastate driving, along with AB 5’s contractor restrictions, means employers cannot take a one-size-fits-all approach. 

Stay informed, apply the right rules, and invest in compliance to avoid costly lawsuits while maintaining fair pay practices in an industry that drives California’s economy forward. 

This post is for informational purposes only and does not constitute legal advice. California’s wage and hour laws for drivers are complex and vary by operation type. Please consult an experienced employment attorney for tailored guidance.