I talk to employees (and employers!) all of the time who think that just because an employee is paid a salary, that she or he does not get paid overtime.
So how does it really work?!
What matters is whether you’re exempt. Exempt from what, you might ask? Exempt from the overtime requirements of the Fair Labor Standards Act (for some really dry reading, see 29 U.S.C. §201 and the following).
You might recognize this language from job descriptions, jobs postings, or pay stubs. You might see “exempt” or “non-exempt” in any of those places. Or you might see “salaried exempt” or “hourly non-exempt” which are the most common. Not too many people see “salaried non-exempt,” but it’s a real thing, and it’s more common than you might think.
How do I know if I’m exempt?
The answer to this question can be very hard. The best answer is to talk to a lawyer - you can have a quick consultation about this with someone at Ramsland Law for no charge.
The most common exemptions are the professional, executive, and administrative exemptions (this one is tricky). Professional usually means things like doctors, lawyers, accountants, dentists, architects, etc. The standard is for people who are plying trades that require advanced training in a field of learning. It includes doctors but not nurses (usually). It includes lawyers but not paralegals (usually).
The administrative exemption does not cover all administrative work. People see “administrative” and think that their administrative assistants, clerks, secretaries, etc are covered by this. NOT SO. Administrative employees have to be making important business decisions that have important impact on the business. Administrative professionals can be super valuable, but aren’t ordinarily making these sorts of decisions.
The executive exemption generally refers to folks who devote a meaningful amount of time to supervising / managing two or more employees. It’s sometimes called the management exemption. It does not apply to project managers or account managers, it applies to people managing people.
For any of these to apply, you also have to be paid on a salary basis. This is probably where some of the confusion comes in. Even this can be a tricky part - the “salary basis test” is not 100% straightforward.
There’s a helpful fact sheet that describes these exemptions HERE.
Other exemptions…
There are many other FLSA exemptions that companies try to use - too many to list in a quick and easy way. The best solution is to talk to a lawyer who knows the FLSA well and can find answers to some pretty hard questions. Even if it’s just a 20 - 30 minute consultation with a lawyer to find out whether you’re really exempt, you maybe leaving a huge amount of money on the table by not looking into it!