For example, the night manager at a fast food restaurant may in reality spend most of the shift preparing food and serving customers. They have created a salary basis test and duties test to determine if an employee is qualified to be exempt from overtime wages. However, the Department of Labor has stated that these positions are generally non-exempt, meaning the salespersons are entitled to overtime pay, including back pay for overtime hours worked before the misclassification was identified and fixed. Identifying most professionally exempt employees is usually pretty straightforward and uncontroversial, but this is not always the case. For a worker to be considered exempt under the creative professional exemption, job duties must primarily include work in a creative industry involving originality and invention. What is the Difference Between an Exempt and Non-Exempt Employee? Although non-exempt employees typically receive hourly pay, employers can pay them on a salary basis and pay applicable overtime.
Whether the duties of a particular job qualify as exempt depends on what they are. We show the key differences. However, none of these commenters provided any information to demonstrate that the educational requirement for paralegals is greater than a two-year associate degree from a community college or equivalent institution. Outside sales do not include sales made by mail, telephone or the internet unless such a call is an adjunct to personal calls. What is an Exempt Employee? Confidential or time-sensitive information should not be sent through this form. Members may download one copy of our sample forms and templates for your personal use within your organization.
Other commenters urge the Department to declare that paralegals are exempt learned professionals. Exempt Status Exempt positions are excluded from minimum wage, overtime regulations, and other rights and protections given to nonexempt workers. Routinely ordering supplies and even selecting which vendor to buy supplies from is not likely to be considered high- enough to qualify the employee for administratively exempt status. In general, an exempt employee must be paid a fixed salary for certain exemptions. Interested in republishing content from this website? Employees in this status should still track their hours worked weekly. See other fact sheets in this series for more information on the exemptions for , , , and employees, and for more information on the requirement. Questions requiring legal advice should be addressed to the attorney of your choice.
Neither members nor non-members may reproduce such samples in any other way e. Currently, there are certain qualifications that must be met in order for a worker to be considered exempt. Whether a journalist is professionally exempt, for example, or a commercial artist, will likely require careful analysis of just what the employee actually does. Both federal and state standards govern how to classify members of your workforce. In addressing public concern, the Secretary of Labor issued many press releases and comments in support of the new rules. Generally, employees are considered non-exempt unless an exemption applies.
This information is intended for educational purposes only and should not be considered legal advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor. Another recognized exemption is for various computer employees. Also, some states have expanded overtime pay guidelines. The job duties tests have many detailed components that are specific to each white collar exemption. Advanced degrees are the most common measure of this, but are not absolutely necessary if an employee has attained a similar level of advanced education through other means and perform essentially the same kind of work as similar employees who do have advanced degrees. Site content © copyright 2019 National Federation of Paralegal Associations, Inc.
The final requirement for the executive exemption is that the employee have genuine input into personnel matters. The job involves work which is necessary to the overall operation of the store -- selecting merchandize to be ordered as inventory. There are two general types of complete exclusion. Most companies employ inside salespeople, including those who make telesales or email sales from remote locations. Examples of administrative functions include labor relations and personnel human resources employees , payroll and finance including budgeting and benefits management , records maintenance, accounting and tax, marketing and advertising as differentiated from direct sales , quality control, public relations including shareholder or investment relations, and government relations , legal and regulatory compliance, and some computer-related jobs such as network, internet and database administration. Please click to accept Send Email.
Explain the basics of exempt and non-exempt employees with this visual guide. These inside sales people are generally not exempt from overtime pay. Once published in the Federal Register, the public will have 60 days to submit comments regarding, among other things, the proposed minimum salary threshold. The only exception is for employees of state or local government agencies. For example, if a law firm hires an engineer as a paralegal to provide expert advice on product liability cases or to assist on patent matters, that engineer would qualify for exemption.
In addition, an employee falling under the executive exemption must have the ability to hire or fire employees, or have the ability to give recommendations regarding hiring and firing. Non-exempt employees must receive at least the minimum wage for all hours worked and overtime pay. An example of administratively exempt work could be the buyer for a department store. . Therefore, salespersons who perform other duties apart from outside sales may still be eligible for overtime. The term commonly refers to exemptions for executive, administrative, professional, outside sales, and computer professional employees.
It involves the exercise of a good deal of important judgment and discretion, since it is up to the buyer to select items which will sell in sufficient quantity and at sufficient margins to be profitable. Another type of exclusion is for jobs which are governed by some other specific federal labor law. It is meant to cover employees in these kinds of jobs whose work requires invention, imagination, originality or talent; who contribute a unique interpretation or analysis. Workers earning over the salary threshold would still need to meet the other criteria for exempt status to be placed on that category. Have you been robbed of overtime? Although there was a great deal of legislation proposed to block the implementation of the new rules, the Department of Labor's changes to the Fair Labor Standards Act regarding white collar exemptions did pass and went into effect on August 23, 2004. Nor is administrative work exempt just because it is financially important, in the sense that the employer would experience financial losses if the employee fails to perform competently.