Exempt and Non-Exempt Employees

The federal Fair Labor Standards Act (FLSA) exempts (or excludes) certain employees from its minimum wage and overtime laws. Employees who are exempt from the FLSA’s minimum wage and overtime laws include:

  • executive, administrative, and professional employees and some computer workers;
  • outside salespeople such as those who do sales away from the employer’s place of business, like a door-to-door salesperson

The FLSA exempts other groups of employees from its minimum wage and overtime laws, including:

  • babysitters on a casual basis;
  • companions for the elderly;
  • federal criminal investigators;
  • fishing employees;
  • homeworkers making wreaths;
  • newspaper deliverers and newspaper employees of limited circulation newspapers; and
  • switchboard operators

The FLSA exempts certain employees from just its overtime laws, including:

  • airline and railroad employees;
  • certain amusement/recreational employees;
  • boat salespeople;
  • domestic employees who live-in;
  • police and firefighters who work in small public police and fire departments;
  • local delivery drivers and their helpers;
  • motion picture theater employees;
  • radio station and television station employees in small markets;
  • taxicab drivers;
  • certain financial services industry employees; and
  • certain registered nurses

With certain exceptions, police and fire departments (unless considered small), first responders, hospitals, residential care establishments and facilities, intermediate care facilities for the developmentally disabled, skilled and other nursing facilities, and assisted living facilities are subject to the FLSA’s minimum wage and overtime laws.  This means that their employees, for the most part, will be considered non-exempt.

Your job title does not decide whether you are exempt from the overtime rules. Instead, you are exempt from the overtime rules if all three of the following factors exist:

  1. You work on a salary basis;
  2. Your salary is at least $455/week; and
  3. Your job title and duties (look at your job description) say that your responsibilities are those of either an administrative employee, an executive,, a certain type of computer worker, or a specially skilled worker.

In addition, if you earn more than $100,000 per year (gross income), and your job is to do professional, administrative or manager’s duties, you are exempt.

Here are a few ways to figure out if you are a non-exempt employee:

  • If you work a regular, 40-hour work week without an employment contract, you are probably non-exempt.
  • No matter what your job title is, if you earn less than $455/week (gross), you are non-exempt.
  • If you are not an executive, or an administrative or professional employee, you are probably non-exempt.

Depending on your responsibilities at work (as stated in your job description), you may be an exempt employee one week and non-exempt another week. It is possible to be misclassified as exempt which might entitle you to back-pay for unpaid overtime work.

In general, as an exempt employee, you are entitled to the same salary every pay period, no matter how many hours you worked. However, there are 7 situations in which your employer may take money out of your salary without violating the law:

  1. If you are absent for personal reasons for one or more full days (not including sickness or disability);
  2. If you are absent due to sickness or disability for one or more full days (deduction must be made in accordance with a plan, policy, or practice of providing compensation for salary lost because of illness);
  3. To offset what you are paid for jury duty, witness fees, or for military pay;
  4. If you violate major safety rules, you may be penalized;
  5. If you violate written company conduct rules, if you are suspended for at least one full day, you may be suspended without pay;
  6. Your employer does not have to pay you for time not worked in your first or last week of employment; or
  7. If you take partial days, full days, or weeks off under the Family and Medical Leave Act.

Legal Editor: Joseph F. Tremiti, February 2015

Changes may occur in this area of law. The information provided is brought to you as a public service with the help and assistance of volunteer legal editors, and is intended to help you better understand the law in general. It is not intended to be legal advice regarding your particular problem or to substitute for the advice of a lawyer.

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