Overtime & Minimum Wage

Overtime & Minimum Wage

The Fair Labor Standards Act (FLSA) is a complicated federal law that provides many protections to employees related to their wages. Two common areas in which employers violate the FLSA are with respect to minimum wage and overtime. Employers are required to pay employees at least minimum wage for all work performed (regardless of whether the work took you longer than the employer wanted it to take). If an employer asks that you not log time that you worked, then you may be entitled to payment for the time worked.

Employers also must generally pay overtime on any hours you work over 40 hours in a workweek. Work time includes not only time when you are at work, but it can also include travel time and time when you are working from home. Employees often think that if they are paid a salary, then they are not entitled to overtime. That is not true. In general, if you are not exempt from overtime, then you must be paid overtime, regardless of whether you are paid based on a salary or hourly basis.

The four most common exemptions to overtime requirements are the professional, executive, administrative, and sales exemptions. These tests are outlined below.

• To be an exempt professional, all of the following tests must be met:
  • Be compensated on a salary or fee basis at a rate not less than $455 per week;
  • Have as a the primary job duty the performance of work requiring advanced knowledge (work that is predominantly intellectual) which includes work requiring consistent exercise of discretion and judgment;
  • The advanced knowledge must be in a field of science or learning; and
  • The advanced knowledge must be customarily acquired by a prolonged course of instruction.
• To be an exempt executive, all of the following tests must be met:
  • Be compensated on a salary or fee basis at a rate not less than $455 per week;
  • Have as the primary job duty managing the enterprise or a customarily recognized department or subdivision;
  • Customarily and regularly direct the work of at least two or more full-time employees or their equivalent; and
  • Must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight.
• To be an exempt administrative employee, all of the following tests must be met:
  • Be compensated on a salary or fee basis at a rate not less than $455 per week;
  • Have as the primary job duty performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and
  • The employee’s primary duty includes the exercise of discretion and independent judgment as to matters of significance.
• To be an exempt outside sales employee, all of the following tests must be met:
  • The primary duty must be making sales or obtaining orders or contracts; and
  • The employee must be customarily and regularly engaged away from the employer’s place of business or home office (this does not generally include sales by mail, telephone, or internet).

Back to Wages & Benefits