The biggest mistake seen in wage and hour law by companies is the belief that employees who are paid in salary, instead of an hourly wage, are not entitled to overtime. The biggest mistake employees make is by not finding out their rights.
The issue is whether the individual is “exempt” or “non-exempt” from overtime under the Fair Labor Standards Act (FLSA).
However, just because you are paid a salary does not mean you are “exempt”. Indeed, there are employees who are paid in salary and are still entitled for overtime, but there are also people who are paid hourly who don’t get overtime pay.
Salaried employees can be required to be paid overtime, unless they meet the requirements for an “exempt” employee, which depends on the laws of the federal and state wage and overtime laws.
This is not a mistake that only small companies make. In fact, the banks across the United States made this mistake. On March 9, 2015 the United States Supreme Court, in Perez v. Mortg. Bankers Ass’n, U.S., No. 13-1041, ruled that the use of the Fair Labor Standards Act’s (“FLSA”) administrative exemption for did not apply mortgage-loan officers.
- Executive, in which an employee’s primary duties involve office or non-manual work directly related to the management of the employer’s operations, and which require the employee to exercise discretion and independent judgment.
- Learned professional, in which an employee’s primary duties involve the performance of work that requires advanced knowledge in a field of science or learning. Advanced knowledge is a kind usually acquired by a prolonged course of specialized instruction, and is not acquired on the job itself.
- Creative professional, in which an employee’s primary duties involve invention, imagination, originality, or talent in a field of creative or artistic endeavor.
In addition, there are hundreds of federal regulations on these issues.
If you are an individual who has been mistakenly considered “exempt” when you are not, you could be owed thousands of dollars. If you are a large corporation, like the banks, you could owe millions of dollars. The Law Office of Glenn D. Levy who are board certified labor and employment law specialists are here to help.