Any employer in today’s marketplace has likely heard of exempt versus non-exempt employees at least once because all employees fall into one category or the other as required by the Fair Labor Standards Act or FLSA. The most basic difference between the two employment classifications is that exempt employees do not qualify for overtime pay or minimum wage. Employers are required to provide non-exempt employees with minimum wage and overtime pay for any overtime hours they work. But this is not the only issue to consider when considering exempt vs. non-exempt employee status.
The most common FLSA exemptions are often called white-collar exemptions and refer to exemptions for executive, administrative, sales, and professional positions. Generally speaking, an employee needs to meet the standards for three tests in order to qualify as FLSA exempt: job duties, salary basis, and salary level.
In order for an employee to pass the “job duties” test, they must consider the list of associated job duties as detailed in the FLSA regulations for each exemption category. Detailed components of the job duties tests are specific to each white-collar exemption, but most state that the employee must exercise discretion and “independent judgment” in the performance of their job duties.
In order for an employee to pass the salary basis test, an employee must be provided compensation on a salary basis (with a few specified exceptions). The salary provided for their work must not be reduced in response to quality or quantity of work performed.
The third test employees must pass in order to be considered exempt is the salary level. All exempt employees must be provided a salary that meets the minimum specified by the FLSA (with a few specified exceptions). The employee must receive the same pay each week in which they work regardless of the number of days they work or the number of hours they work.
A non-exempt employee must be paid at least minimum wage for all hours they work, and overtime pay for any overtime hours they work. Employees are considered non-exempt unless an exemption applies to their working situation. Non-exempt employees generally receive hourly pay, but employers can pay them on a salary basis with overtime. When non-exempt employees work more than a full, 40-hour workweek, federal law requires that their employer provide them with 1.5 times their regular rate of pay for their overtime hours.
If you believe you may be misclassified on the job or if you aren’t being paid overtime, get in touch with one of the experienced Atlanta employment law attorneys at Barrett & Farahany so we can help you determine if you qualify as exempt or if you are a victim of wage theft.