The Fair Labor Standards Act (FLSA) covers many things, such as what places are thought to be exempt vs. nonexempt positions. The FLSA is a national law which all countries must adhere to remain compliant with.
First, a couple of definitions:
Exempt Employee: workers that are salaried and aren't eligible for overtime pay.
Non-Exempt Worker: workers that are hourly and therefore are eligible to get overtime pay.
Thus, how can a company determine whether a position is deemed exempt or non-exempt? The FLSA defines and decides what kinds of positions qualify for which kind of project through an assessment of wages amount, salary basis, and job responsibilities. First of all, workers may or might not be covered based on the amount of workers in the organization, the total amount of business the firm does annually, and the kind of position the employee holds. Additionally, to be insured under the FSLA, there has to be a worker - employer arrangement; contract workers aren't insured.
There are five chief categories that might qualify an employee to be cheated: executive, administrative, professional, outside sales, and sometimes computer workers. This post will concentrate on the job responsibilities as the name alone doesn't qualify an employee as exempt. Nonetheless, in most instances, to be cheated the employee should be given a minimum of $455 a week in salary. It's also worth noting that highly paid employees getting $100,000 in annual compensation, and fulfill the needs of the work evaluation, are exempt from the FLSA.
Specific job responsibilities tests have to be run and fulfilled to qualify the worker with a few of the aforementioned job titles as exempt. This evaluation information comes straight from the FLSA.
Executive Exemption
Fact Sheet #17B for your FLSA requires the following criteria to be fulfilled to ascertain executive exemption standing:
The employee must be paid on a salary basis (as described in the regulations) at a speed less than $455 a week;
The employee's primary duty must be managing the enterprise, or managing a customarily recognized department or subdivision of the venture;
The employee must customarily and regularly direct the work of two or more other fulltime workers or their equivalent; and
The worker should have the ability to hire or fire other employees, or the employee's suggestions and recommendations regarding the hiring, firing, advancement, promotion or any other change in status of other employees should be given special weight.
Fact Sheet #17C for your FLSA requires the following criteria to be fulfilled to ascertain administrative exemption standing:
The employee must be compensated on a salary or fee basis (as defined in the regulations) at a speed less than $455 a week;
The employee's primary duty must be the performance of office or non-manual work directly linked to the management or general business operations of their employer or the employer's clients; and
The employee's primary duty includes the exercise of discretion and independent judgment with respect to matters of importance.
Professional Exemption
Fact Sheet #17D for your FLSA requires the following criteria to be fulfilled to determine Expert exemption standing:
The employee must be compensated on a salary or fee basis (as defined in the regulations) at a speed not less than $455 a week;
The employee's primary duty must be the performance of work requiring advanced knowledge, defined as work that's predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment;
The advanced knowledge must be in a field of science or learning; and
The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.
Outside Sales Exemption
Fact Sheet #17F for your FLSA requires the following criteria to be fulfilled to ascertain outside sales exemption standing:
The employee's primary duty must be making sales (as defined in the FLSA), or obtaining orders or contracts for services or for the use of facilities for which a consideration will be paid by the customer or client; and
The employee must be customarily and regularly engaged away from the employer's place or places of business.
Computer-Related Occupation Exemption
Fact Sheet #17E for your FLSA requires the following criteria to be fulfilled to determine computer-related job statute standing:
The employee must be paid on a salary or fee basis at a rate less than $455 per week or, if paid on an hourly basis, at a speed less than $27.63 per hour
The worker must be employed as a computer systems analyst, computer programmer, software engineer or other similarly skilled worker in the computer field performing the duties described below;
The employee's primary duty must include:
1) The application of systems analysis Methods and procedures, including consulting with users, to determine hardware, software or system functional specifications;
2) The design, development, documentation, analysis, creation, testing or modification of computer programs or systems, including prototypes, based on and related to user or system design specifications;
3) The design, documentation, testing, creation or modification of computer programs related to machine operating systems; or
4) A combination of the aforementioned duties, the performance of which requires the identical degree of abilities.
When deciding if an employee is exempt or not make certain to consult these evaluations in order for your organization is in complete compliance with the FLSA legislation. Remember that state laws also influence how workers are categorized. When determining the correct classification for your workers make certain to check the state laws too. The legislation that protects the worker that the most is that the law which needs to be followed. Further information on liability vs. non-exempt employees are located on the Wage and Hour Division website.