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salaried employees, overtime

In the United States, a covered employer is required to pay most employees overtime for all time worked beyond 40 hours in a given workweek.

The overtime requirement, as well as the minimum wage laws, are found in the Fair Labor Standards Act, or FLSA. The FLSA is a federal law that is administered and enforced by the U.S. Department of Labor, Wage and Hour Division.

There are a number of exceptions to the overtime requirement, including “bona fide executive, administrative, professional and outside sales employees as well as certain computer employees” most of whom are salaried employees. Are salaried employees always exempt from overtime though?

The FLSA makes it clear that most workers are required to be paid overtime, at a rate not less than one and one half the worker’s regular rate of pay, for all time the worker works beyond 40 hours in a workweek.

An employee’s workweek is a fixed and regularly recurring period of 168 hours — seven consecutive 24-hour periods. Not all employees, however, are paid by the hour. In fact, most “professional” employees are paid on a salary basis.

When an employee is paid a salary the employee receives a fixed amount in wages each pay period without regard to the number of hours the employee worked during that pay period. Some pay periods the employee might work more than 40 hours in a workweek while in others the employee might work less; however, the employee’s wages remain the same.

Many, but not all, salaried employees are exempt from the overtime requirement. To qualify for an exemption, employees generally must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week. An employee’s job title does not determine if the employee is exempt from overtime pay.

For example, the test for “Executive” exemption requires all of the following tests to be met:

  • The employee must be compensated on a salary basis (as defined in the regulations) at a rate not less than $455 per week;
  • The employee’s primary duty must be managing the enterprise, or managing a customarily recognized department or subdivision of the enterprise;
  • The employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent; and
  • The employee 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.

A similar test exists for exemptions for “Administrative,” “Professional,” “Outside Sales” and “Computer” employees who are paid on a salary basis. If any part of the requisite test is not met, an employee is not exempt from the overtime requirements found in the FLSA even if the employee is a salaried employee.

If you are an employer and you are unsure whether or not you need to pay overtime, or you are an employee who is unsure if you are entitled to receive overtime pay, contact the experienced Florida employment law attorneys at Celler Legal, P.A. by calling 954-716-8601 to schedule your appointment.

To learn more, please download our free Florida overtime wage exemptions here.