Q. I work for $10.00 an hour, but have been told that I am on salary. I am guaranteed pay for 40 hours a week, but my boss expects me to work 6 days a week. Does he have the right to pay me for only 40 hours, when in fact I work 46 – 50 hours a week?
A. Pay disputes cause great friction in organizations and employees and employers need to be clear on the terminology of pay, and the legal implications in that terminology. Employees fall into specific categories of exempt and non-exempt. These classifications need to be assigned correctly by your employer. “Exempt” employees are on salary(and exempt from the overtime law), which means they are not entitled to overtime. “Non exempt” employees are not exempt (from the overtime law) and are entitled to overtime pay. The distinction can be confusing, and often employees classified in one category wish they were classified as the other.
For your situation, I consulted with Attorney Sheryl Eisenberg, a Labor and Employment attorney at Hirsch Roberts Weinstein LLP, who regularly counsels clients on Wage and Hour matters.
“Many employers mistakenly believe that simply paying an employee a salary, as opposed to an hourly wage, allows the employee to be treated as exempt from the overtime provisions of the Fair Labor Standards Act (“FLSA”)” says Attorney Eisenberg.
There are three tests – salary level, salary basis, and duties, which must be satisfied before an employee can be properly classified as “exempt.” Attorney Eisenberg explains. 1. As a general rule, the employee must earn the equivalent of at least $455.00 per week. 2. The employee must receive the same amount of minimum guaranteed salary for each workweek regardless of the quality or quantity. 3. The employee must perform certain duties that place the employee within a certain category – executive, administrative or professional – before the employee can be properly classified as exempt. Examples of duties within these categories are management or supervisory roles, and administrative responsibility related to the management of the business needing independent judgment in areas of significance. Some roles which are exempt from overtime laws include doctor’s, lawyers, teachers, and individuals earning over $100,000.
Employees who do not satisfy all three of these tests are not properly classified as exempt and are entitled to receive overtime for all hours worked over 40 in a given workweek.
Many employees regularly review the classifications of employees to see if the roles have changed, and new classifications are in order. You, your boss, and a human resources person should review your role and classification to determine if you are misclassified.