Many employers struggle with the differences between hourly and salaried positions and how to qualify them as such.
Below is a quick reference to determine if a position is exempt from the overtime provisions of the Fair Labor and Standards Act (FLSA).
- To qualify for the executive exemption, a worker must earn at least $455/week ($330 in American Samoa).
- Primary duty consists of management of the organization in which the employee is employed or of a customarily recognized department or subdivision of the enterprise.
- Customarily and regularly directs the work of two or more full time employees.
- Has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring, firing, advancement, promotion, or any other change of status of other employees are given particular weight.
The definition of management refers to “customarily and regularly” conducts the following duties:
- Interviewing, selecting, and training employees
- Setting and adjusting the rates of pay and hours of work of employees
- Directing the work of employees
- Maintaining production or sales records for use in supervision or control
- Appraising the productivity and efficiency of employees for the purpose of recommending promotions or other changes in their status
- Handling employee complaints and grievances
- Disciplining employees
- Planning the work of employees
- Determining the techniques to be used to perform the work
- Apportioning the work among the employees
- Determining the type of materials, supplies, machinery, equipment, or tools to be used of merchandise to be bought, stocked, and sold
- Controlling the flow and distribution of materials or merchandise and supplies
- Providing for the safety and security of the employees or the property
- Planning and controlling the budget
- Monitoring or implementing legal compliance measures
Reference: SHRM.org, DOL.gov (FLSA Exemptions)
