Who is considered exempt employees

Salary level test. Salary basis test. However, whether an employee is paid on a salary basis is a "fact," and thus specific evaluation of particular circumstances is necessary. The FLSA salary basis test applies only to reductions in monetary amounts. Requiring an employee to charge absences from work to leave accruals is not a reduction in "pay," because the monetary amount of the employee's paycheck remains the same.

Similarly, paying an employee more than the guaranteed salary amount is not normally inconsistent with salary basis status, because this does not result in any reduction in the base pay. With some exceptions, the base pay of a salary basis employee may not be reduced based on the "quality or quantity" of work performed provided that the employee does "some" work in the work period.

For example, a salary basis pay employee's base pay may not be reduced if there is "no work" to be performed such as for a plant closing or slow period , and a salary basis employee's base pay may not be reduced for partial day absences. However, employers may "dock" the base pay of salary basis employees in full day increments, for disciplinary suspensions, or for personal leave, or for sickness under a bona fide sick leave plan as for example if the employee has run out of accrued sick leave.

Thus, there can be "permissible" and "impermissible" reductions in salary basis pay. Permissible reductions have no effect on the employee's exempt status. Impermissible reductions may, in that the general rule is that an employee who is subjected to impermissible reductions in salary is no longer paid on a salary basis, and is therefore nonexempt. However, employers have several avenues by which they can "cure" impermissible reductions in salary basis pay, and as a practical matter these make it unlikely that an otherwise exempt employee would become nonexempt because of salary basis pay problems.

The salary basis pay requirement for exempt status does not apply to some jobs for example, doctors, lawyers and schoolteachers are exempt even if the employees are paid hourly. These FLSA exemptions are limited to employees who perform relatively high-level work. Whether the duties of a particular job qualify as exempt depends on what they are.

Job titles or position descriptions are of limited usefulness in this determination. It is the actual job tasks that must be evaluated, along with how the particular job tasks "fit" into the employer's overall operations. There are three typical categories of exempt job duties, called "executive," "professional," and "administrative. Exempt executive job duties. Job duties are exempt executive job duties if the employee.

Supervision means what it implies. The supervision must be a regular part of the employee's job, and must be of other employees. Supervision of non-employees does not meet the standard.

The "two employees" requirement may be met by supervising two full-time employees or the equivalent number of part-time employees. Two half-time employees equal one full-time employee. In addition, the supervisory employee must have "management" as the "primary duty" of the job. Page Content. Exempt : An individual who is exempt from the overtime provisions of the Fair Labor Standards Act FLSA because he or she is classified as an executive, professional, administrative or outside sales employee, and meets the specific criteria for the exemption.

Certain computer professionals may also be exempt. With some limited exceptions, exempt employees must be paid on a salary basis. Nonexempt : An individual who is not exempt from the overtime provisions of the FLSA and is therefore entitled to overtime pay for all hours worked beyond 40 in a workweek as well as any state overtime provisions.

Nonexempt employees may be paid on a salary, hourly or other basis. Salaried : An individual who receives the same salary from week to week regardless of how many hours he or she works. Exempt employees must be paid on a salary basis, as discussed above. Nonexempt employees may be paid on a salary basis for a fixed number of hours or under the fluctuating workweek method. Salaried nonexempt employees must still receive overtime in accordance with federal and state laws.

In New York, the state's minimum salary threshold for executive and administrative employees has been increased in phases, and the actual rate depends on geographic location and employer size. Check with your state labor department for the latest overtime provisions in your area. The information contained in this article is not legal advice and is not a substitute for such advice.

Department of Labor. State of California Department of Industrial Relations. New York State Labor Department. Actively scan device characteristics for identification. Use precise geolocation data. Select personalised content. Create a personalised content profile. Measure ad performance. Select basic ads. Create a personalised ads profile. Select personalised ads. Apply market research to generate audience insights. Salaried non-exempt employees Employers should not automatically assume that employees can properly be considered exempt under the FLSA just because they earn a salary.

Hourly exempt employees Some industries may have hourly employees who are exempt from overtime pay. The more notable examples include the agriculture, movie theater and railroad businesses Employee classification Failure to properly distinguish exempt from non-exempt employees, sometimes referred to as misclassification, can adversely affect businesses.

Misclassification may result in: Regulatory enforcement action Fines and penalties Employee lawsuits for unpaid overtime Costs to remedy misclassification Sometimes reclassification is necessary, but this too comes with risks. FAQ How do you classify employees?

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