We are pleased to present the latest memo in our ongoing series focused on the so called “white collar” exemptions under the federal Fair Labor Standards Act (FLSA). This part provides guidance on a simplified test used to determine the exempt status of certain “highly compensated” employees.
The FLSA’s white collar exemptions – executive, administrative, and professional – are the three most commonly applied exemptions to the law’s requirement that employers pay employees overtime for any hours worked over 40 in a workweek. The Labor Department’s regulations defining these exemptions have three requirements in order for an employee to be exempt from overtime pay:
the employee must meet the duties tests for executive, administrative, or professional employees; the employee must earn a specified minimum salary; and the employee’s minimum salary must be paid on a “salary basis.” This latest memo focuses on an alternative to the standard duties tests that may be used to establish the exemption for certain highly compensated employees.
Members of the Center for Workplace Compliance (CWC) can read more here.