Exempt Employee Misclassification

What Is an Exempt Employee?

An exempt employee is an employee who earns a salary. They earn the same pay whether they work an hour a day or 60 hours a week (or more). As a result, employers do not pay exempt employees overtime.

What Qualifies an Employee as Exempt?

An exempt employee must meet the following criteria. Otherwise, they are not exempt from overtime.

1. The employee must earn at least $684 per week (in most cases).

2. The employee must meet at least one of the following thresholds:

• They are an executive employee. They manage the company, department, or company division. Another way they fit the category is to manage or oversee at least two employees. They have the authority to hire or fire other employees. Finally, they have weight in their suggestions regarding hiring, firing, promoting, advancing, or changing an employee’s status.
• They are an administrative employee. Administrative employees’ primary duties are performing office or non-manual work directly related to managing business operations for the company or its customers. They also help provide judgment over significant issues.
• They are a professional employee. They conduct work requiring advanced knowledge and a specific degree or learned skill. They have advanced knowledge related to science or learning. They are creative professionals who perform work requiring invention, imagination, originality, or talent as determined and recognized in the artistic and creative world.
• They are a computer employee. They earn $684 per week or at least $27.63 per hour. They work as a computer systems analyst, computer programmer, software engineer, or a similar type of skilled computer worker. Their primary duties include application systems analysis, design, development, analysis, creation, testing, or modifying computer systems or programs, or design, documenting, testing, creating, or modifying computer programs.
• They are outside sales representatives. They make sales for which the client pays the company as a primary job duty. They usually work away from the office and place of business.
• They are high-earning employees. They perform office or non-manual work. They earn at least $107,432 (including the $684 weekly as a paid salary or fee).