Classifying Your Work Force: Exempt vs' NonExempt

1
Classifying Your Work Force Exempt vs. Non-Exempt

• Norm Brumblay
• Manny Tyndall
• Amie Wilson

2
Overview of Overtime and Comp Time

• The Law FLSA establishes overtime pay at a rate
  of not less than 1 ½ times the employees regular
  rate of pay required after 40 hours of work in a
  work week
• Federal, state, and local government employers
  are allowed to provide compensatory time off
• Critical component of FLSA is exempt or
  non-exempt classification

3
Non-Exempt

• Employees who do not meet exempt status and are
  covered by the minimum wage and overtime
  provisions of FLSA
• Typically paid hourly for 40 hour work week
• Entitled to minimum wage of 5.15 per hour and/or
  overtime pay protections of 1 ½ times of regular
  rate of pay

4
Exempt

• Certain occupations and industries (typically
  salaried employees) that are exempt from the
  overtime provisions
• Executive Work
• Administrative Work
• Professional Work
• Outside Sales
• White Collar
• Other Exceptions

5
Exempt vs. Non-Exempt?

• Making the call if unsure, it is better to
  assume non-exempt status
• Dept. of Labor may recover back wages for
  employees who have been underpaid
• Fines of up to 1,100 per violation may be
  assessed against employers who violate the law

6
Did You Know?

• Employees may not waive their rights to be
  compensated for overtime hours worked and may not
  agree to be paid a lower overtime rate
• Recent change to the law - Some employees in
  white collar positions are now determined to be
  FLSA non-exempt and are eligible for overtime
  compensation. 
• Information can be found at
• http//www.dol.gov.

7
Conclusion

• Its the law - Employers must meet requirements
  of FLSA
• Appropriate classification is key to determining
  eligibility of compensation
• Do your research - http//www.dol.gov

8
Questions?
9
Rosenfeld, Larry, (March 24, 2003) The Rules on
Comp Time How to determine whether you can give
your employees comp time instead
of overtime. Retrieved from website
http//www.entrepreneur.com/article/0,4621,307450,
00.htmlEisenbrey, Ross and Bernstein, Jared.
Economic Policy Institute Briefing Paper
Eliminating the Right to Overtime Pay. (n.d.)
Retrieved from website http//www.epinet.org/cont
ent.cfm/briefingpapers_flsa_jun03Eisenbrey,
Ross. Economic Policy Institute Issue Brief
The Naked Truth About Comp Time. (n.d.)
Retrieved from website http//www.epinet.org/cont
ent.cfm/Issuebriefs_ib190 Seyfarth, Shaw,
Fairweather, and Geraldson. (1998). How to
Comply. Federal Employment Laws and
Regulations.Aspen Publishers. (2004). Mandated
Benefits. 2004 Compliance Guide.