Firstly, you'll want to set up your Pay Class and become familiar with the general overtime settings as explained in these articles:
Basic Pay Class set up - How to Setup Salary Calculation
Overtime set up - How to Configure Overtime Rules for Shifts
The following screenshots show the pay codes and pay class settings necessary to calculate overtime according to California labor laws:
I. Regular Pay Code
II. OT1 Pay Code
III. OT2 Pay Code
IV. Pay Class