Am I Exempt From Overtime Requirements?
Many salaried employees mistakenly believe that because they are paid a salary they are not entitled to overtime pay. In fact, this is often not the case!
An employee must qualify as "exempt" under the Fair Labor Standards Act ("FLSA") for a company to be able to lawfully withhold overtime pay. So, what is the difference between exempt and nonexempt?
FLSA "Exemption" Defined
Under the FLSA, the majority of employees throughout the U.S. are entitled to minimum wage and to overtime pay at a rate of one-and-a-half times their normal pay for any hours over 40 worked in a workweek. There are certain types of employees, however, that are not entitled to overtime based on their type of job, duties, knowledge and earnings. Generally speaking, an employee must make no less than $455 per week and must meet certain requirements based on his or her duties.
Types Of Exemptions
To qualify for an FLSA overtime exemption, employees generally must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week. Job titles do not determine exempt status. In order for an exemption to apply, an employee's specific job duties and salary must meet all the requirements of the Department's regulations.
Here is a very basic synopsis of some of the most common FLSA overtime exemptions:
The employee must earn a salary of no less than $455 per week; the employee must manage the company or a part of the company; the employee must supervise other employees; and the employee must have the authority to or have influence in the hiring, firing and promotion of other employees.
The employee must earn a salary of no less than $455 per week; the employee must perform office/non-manual work related to the management or operations of the business; and the employee must be able to make important decisions.
Learned Professional Exemption
The employee must earn a salary of no less than $455 per week; the employee must work in an area that requires advanced knowledge and the ability to make informed, important decisions; and the employee must be specially educated/trained in a field of science or learning.
Creative Professional Exemption
The employee must earn a salary of no less than $455 per week; and the employee's primary work must be artistic or creative in nature, requiring imagination, talent, invention or originality.
Computer Employee Exemption
The employee must earn a salary of no less than $455 per week or an hourly rate of no less than $27.63 per hour; the employee must work in the field of computers in an area requiring special skill; and the employee's primary duties must include or relate to computer programming, software development, software design, systems analysis and similar computer-related tasks.
Outside Sales Exemption
The employee's primary job duties must include sales or taking orders from customers; and the employee must work away from the employer's place of business on a regular basis.