Salaries & Overtime can Exist

Many people believe that employees who are paid a salary are not entitled to overtime pay. This is not necessarily true. In fact, many workers who receive a salary are entitled to overtime pay for all hours worked over forty in a workweek. While it is true that, in order to be considered exempt from the overtime laws, an employee must be paid a salary, this is not the end of the inquiry.  In addition to being paid a salary (of at least $455 per week), the employee must also perform exempt job duties before they can legally be denied overtime pay.

So, what are exempt job duties? There are several categories, but most common involve executive—or managerial—job duties, administrative duties, or professional duties. To be exempt as a managerial employee, the worker’s primary duty must include activities such as interviewing, selecting, and training of employees; setting and adjusting their rates of pay and hours of work; directing the work of two or more full-time employees; handling employee complaints and grievances; and disciplining employees. The employee must also have the authority to hire or fire other employees, or their suggestions on hiring or firing must be given particular weight. Importantly, an employee’s job title is not controlling so simply being called a “manager” or “team lead” does not necessarily exempt an employee from entitlement to overtime pay.

To be exempt as an administrative employee, it is required that the employee perform office or non-manual work directly related to the management or general business operations of the employer, and that these duties require the exercise of discretion and independent judgment with respect to significant matters. Examples of these duties include tasks such as dealing with the employer’s HR issues, insurance, accounting, advertising, or purchasing, as opposed to producing the actual goods or services the employer provides to its customers or clients.

Finally, to be exempt as a “learned professional”, the employee must perform work requiring advanced knowledge which is predominately intellectual in character and which requires the exercise of discretion and judgment, relates to a field of science or learning, and which is customarily acquired by a prolonged course of specialized intellectual instruction.  Typically, to be exempt as a learned professional, the employee must have acquired their skill by advanced specialized instruction as opposed to on-the-job experience.

Employees who have received a salary but did not perform exempt job duties are generally entitled to recover unpaid overtime when they have worked more than 40 hours in a week during at least the past two years, and sometimes three years.  The law that governs this area is the Fair Labor Standards Act, often referred to as the FLSA.

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Photo of David Langenfeld David Langenfeld

David Langenfeld is Board Certified as a Specialist in Labor and Employment Law by the Texas Board of Legal Specialization. Mr. Langenfeld represents employees from various industries in claims and lawsuits against employers and former employers. Mr. Langenfeld has been a lawyer for…

David Langenfeld is Board Certified as a Specialist in Labor and Employment Law by the Texas Board of Legal Specialization. Mr. Langenfeld represents employees from various industries in claims and lawsuits against employers and former employers. Mr. Langenfeld has been a lawyer for more than twenty-five years. During that time he has successfully represented workers in cases involving unpaid overtime wages, wrongful termination, and employment discrimination. In addition to litigating these cases, Mr. Langenfeld has lectured to attorneys and human resource professionals on issues involving employment law.

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