Salaried Employees

The FLSA does not require overtime pay for salaried employees if certain other conditions are met.

Typical Problems:

• Just because a worker receives a salary that does not mean the worker cannot be due overtime
• Reduction in employee’s pay for time missed when sick
• Failure of employers to pay full salary owed each week.
• Employees classified as management who do not actually perform management tasks as set out by the law
• Employees with degrees that usually apply to the exemptions, but who are not using the degree on the job
• Employers confusing acquired job skills with the use of independent judgment

  Definitions:

• Salaried employees receive a set pay each workweek without taking into account the actual number of hours worked

Consider the following factors: 

Do you “manage” or “supervise” other employees?

• Management or supervision of other employees means that two or more full time employees report to you for work assignments and oversight of their daily tasks

  Are you subject to pay docking if you miss part of the regular work day? 

• If so then you are not exempt from overtime pay because pay docking is inconsistent with your status as a “salaried” manager or supervisor.

  Do you spend a majority of your time performing management or supervisory duties?

• This is where most employers get into trouble. 
• Managers/Supervisors must spend at least 80% (in retail and service industries 60%) of their time in management duties
• In other words, if you spend a large part of your time performing tasks such as ringing up sales, preparing food orders or filling in for absent non-managers then you may not be a “true” manager or supervisor and might be due overtime.
• If you spend a large part of your time performing tasks such as ringing up sales, preparing food orders or filling in for absent non-managers then you may not be a “true” manager or supervisor and could be due overtime.
• Some employers will abuse so-called salaried assistant and associate manager employees, requiring them to perform a large amount of “fill-in” work for non-salaried employees who do not show up for work.  This occurs more often when hiring is tight.  This illegal practice works because the employer uses as an incentive the possibly becoming a manager with a much greater salary and eligibility for greater bonuses.  Often, the salaried assistant and associate manager employees will work a very large number of overtime hours, resulting in a very large amount due the employee.  The amount due could be in the tens of thousands of dollars.  Unfortunately, this unfair practice is much more common than most people think.
• Some examples of management duties include:
  1. setting the schedules of other employees
  2. making decisions about hiring or firing employees
  3. directing the work of at least 2 other full-time employees

  Are you paid on an hourly basis or on a salary? 

• If you are paid hourly, then you are not exempt from overtime pay regardless of your management duties.

  See Managers, Supervisors, Assistant Managers and Associate Managers.