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Debunking The Big Overtime Myth About Salaried Employees

With Friday fast approaching, more than 65 million US workers are about to get what they’ve been waiting for all week: a paycheck. More specifically, their salary.

It might come as a check or a direct deposit, but chances are it’ll look exactly like you expect it to.

No matter how much your salary is, it’s unlikely to change from week to week. But that’s what a salary is, right? The same amount of money, paid out regardless of how many hours you work.

Wrong.

This Overtime Lie Is Cheating People Who Make A Salary

For many salaried employees, that paycheck should be changing. Because people who make a salary are often entitled to overtime pay under federal law.

But that right isn’t always respected.

The Real Salaried Employees Overtime Rule

Some employers tell their workers that getting a salary automatically means no overtime. That’s an outright lie.

Salaries are only one part of a much larger equation that determines whether or not you’re entitled to extra wages. So what else goes into the equation?

Duties, what you actually do in your job.

To be exempt from the Fair Labor Standards Act (exempt means not entitled to overtime), you need to:

Make A Salary Of At Least $455 Per Week

You make a “salary” if you get paid a predetermined amount for any week in which you work. That amount can’t be reduced because of changes in the quality of your work.

If you’re employer reduces your salary because the business is having trouble, you’re not actually salaried. Nor can your salary be reduced because there just isn’t enough work for you to do. That would make you more like an hourly worker.

The salary requirement might not apply for some teachers, lawyers and medical professionals. Based on their actual duties, those workers might be exempt, even if they get paid an hourly rate.

Perform The Duties Of An “Exempt” Employee

There are three types of exempt employee (four counting “outside salespeople“):

  • Professionals, who do work that’s “intellectual” in nature and usually have advanced degrees in their field.

Professionals don’t follow a script; they veer away from the manual and use their own discretion to make decisions that affect the business.

  • Administrators, who perform office work that directly affects the management of a business or its general operations.

Being an administrator is more than filing papers, taking calls and scheduling meetings. Like professionals, they use independent judgment to decide critical matters that will affect their company.

Most administrative assistants should make overtime.

  • Executives, who manage a business or part of a business by directing the work of two or more other employees.

Executives control personnel decisions within their company. At the least, they make constructive suggestions on who to keep and who to fire or who deserves a promotion.

Unless you fit into one of those categories, you probably deserve overtime. But are you making it?

When the federal government raised the overtime salary limit in 2005, the Department of Labor (DOL) found that only 52% of employers had changed with the times and begun paying their salaried employees overtime.

There’s no evidence that businesses have gotten any better in the decade since then.

Where Are Overtime Violations Common?

So which salaried employees are most likely to be the victim of an overtime violation?

The statistics are spotty on this question; in fact, it looks like researchers disregard the salaried workers who are entitled to overtime when they study wage theft. Still, the numbers collected by DOL investigators suggest that salary violations are highest in:

Hotels

Motels

Restaurants

Nursing Homes

 

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