The FLSA’s white collar exemptions – executive, administrative, and professional – are the three most commonly applied exemptions to the FLSA’s requirement that employers pay employees overtime for any hours worked over 40 in a workweek. The regulations issued by the U.S. Department of Labor (DOL) interpreting the exemptions require that an employee must satisfy three “tests” if he or she is considered to be exempt. The employee (1) must meet the duties tests for executive, administrative, or professional employees; (2) must earn a specified minimum salary; and (3) must be paid on a “salary basis.” Our previous analysis in this series focused on the duties tests applicable to executive, administrative, or professional employees, respectively. This analysis focuses on what it means to be paid on a salary basis consistent with DOL’s FLSA regulations.
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