In the US, a majority of jobs held by the nation’s employees are governed by the Fair Labor Standards Act (FLSA). Jobs are divided, in terms of wages payable and overtime wage eligibility, by whether the jobs are deemed to be Salary Exempt, or Non-Exempt positions. Non-exempt employees are entitled to overtime pay, while Salary Exempt Employees are not. For salaried employees involved in sales positions, overtime pay depends on whether they are considered primarily outside sales, or inside sales (working in the employer’s store). Employees with primarily Outside Sales positions are not entitled to overtime pay, while those with Inside Sales positions are.
The test to determine whether a salaried employee is exempt or non-exempt for most other jobs other than sales depends on several factors:
A. The amount of monthly salary,
B. How the salary is determined, and
C. The type of work done by the employee.
Under the majority of circumstances, to be considered exempt, an employee must be:
1. Paid a minimum of $455 per week----which works out to $23,600 per year;
2. They must be paid on a salary basis---meaning whether they work 40 hours a week or 20 hours a week they earn the same minimum salary; and
3. They perform job duties which are considered exempt.
In almost all circumstances, only white-collar jobs may be considered Salary-Exempt. Whereas, jobs such as manual labor, working with your hands constructing items or repairing things, and workers who perform work involving repetitive operations with their hands, physical skill and energy may not be classified as Salary-Exempt.
With the while-collar jobs, there are further restrictions on which ones may be considered Salary-Exempt, and there are further tests applied to those positions. The primary tests of these positions looks at whether the employee:
1. Supervises at least two employees and whose job is primarily supervisory/management related, and has the authority to make decisions on behalf of the employer such as hiring and firing of employees.
2. Acts in an Administrative capacity in a position that involved non-manual labor related to management and/or the general business operations of the employer and requires the use of independent judgment by the employee over important matters of the employer’s business.
3. The third test for Salary-Exempt positions looks at whether the position is one which requires an advanced college decree---generally considered to be a Master’s Degree or higher. This is known as the Learned Professional exception. This exception generally expects that the work performed by the employee will be primarily intellectual in nature and like the Administrative and Supervisory exceptions, involve the exercise of discretion and judgment by the employee.
DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.
The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).