Overtime Pay Exemptions

Exemptions under the Fair labor Standards Act (FLSA) are:

  • Administrative Employees, if
    • their salary is paid on salary or fee basis at a rate not less than $455 per week;
    • their salary is at least equal to the entrance salary for teachers in the same educational establishment, and whose primary duty is performing administrative functions directly related to academic instruction or training in an educational establishment;
    • their primary duty is the performance of office or non-manual work directly related tot the management or general business operations of the employer or the employer's customers - this is not limited to work in functional areas such as tax, finance, accounting, budgeting, auditing, insurance; quality control; purchasing; procurement; advertising; marketing; research; safety and health; personnel management; human resources; employee benefits; labor relations; public relations; government relations; computer network, Internet and database administration; legal and regulatory compliance; and similar activities.;
    • their primary duty includes the exercise of discretion and independent judgment with respect to matters of significance - i.e. serious financial loss.
  • Agricultural employees who are:
    • employed on a small farm - less than 500 'man days' work in any calender quarter. Definition 'man day': any day during which an employee performs agricultural work for at least an hour;
    • immediate family members of their employer;
    • principally engaged on the range in the production of livestock;
    • local hand harvest laborers who: - commute daily from their permanent residence, are paid on a piece rate basis in traditionally piece-rated occupations, and were engaged in agriculture less than thirteen weeks during the preceding calendar year;
    • non-local minors, 16 years of age or under, who are hand harvesters, paid on a piece rate basis in traditionally piece-rated occupations, employed on the same farm as their parent, and paid the same piece rate as those over 16.
      • (Agriculture does not include work performed on a farm which is not incidental to or in conjunction with such farmer's farming operation. It also does not include operations performed off a farm if performed by employees employed by someone other than the farmer whose agricultural products are being worked on.)
  • Aircraft salespeople.
  • Airline employees.
  • Amusement/recreational employees, if:
    • the employer is a national park/forest/Wildlife Refuge System;
    • the employer is an amusement or recreational establishment - for example he concessionaires at amusement parks and beaches - if it:
    • does not operate for more than seven months in any calendar year, or during the preceding calendar year, its;
    • average receipts for any 6 months of the year are not more than 33 1/3 percentum of its average receipts for the other 6 months of such year.
    • NOTE: central functions of an organization operating more than one such establishments - as in the case of employees of a central office, warehouse, garage - or commissary which serves a chain of exempt "amusement or recreational" establishments are not within the exemption.
  • Automobile dealership employees, if:
    • they are salesman, partsmen and mechanics
  • Babysitters on a casual basis.
  • Boat salespeople.
  • Buyers of agricultural products.
  • Commissioned sales employees, if:
    • the employee is employed by a retail or service establihment;
    • more than half of the employee's earnings in a representative period - at least a month and no longer than a year - must come from commissions;
    • the employee's regular rate of pay exceeds one and one-half times the minimum wage for each hour worked in a workweek in which overtime hours are worked.
  • Companions for the elderly.
  • Computer professionals, if the employee
    • is paid at least $455 per week on a salary basis, or paid on an hourly basis, at a rate not less than $27.63 an hour;
    • is not engaged in the manufacture or repair of computer hardware and related equipment;
    • is employed as a computer systems analyst, computer programmer, software engineer or other similarly skilled worker in the computer field and his/her primary duty must consist of:
      • the application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software or system functional specifications;
      • the design, development, documentation, analysis, creation, testing or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications;
      • the design, documentation, testing, creation or modification of computer programs related to machine operating systems;
      • a combination of the aforementioned duties, the performance of which requires the same level of skills.
  • Country elevator workers
  • Creative Profession Exemption, if
    • the employee is compensated on a salary or fee basis at a rate not less than $455 per week;
    • th e employee’s primary duty is the performance of work requiring invention, imagination, originality or talent in a recognized field of artistic or creative endeavor. The requirements are generally met by actors, musicians, composers, soloists, certain painters, writers, cartoonists, essayists, novelists, and others as set forth in the regulations.  Journalists may satisfy the duties requirements for the creative professional exemption if their primary duty is work requiring invention, imagination, originality or talent.  Journalists are not exempt creative professionals if they only collect, organize and record information that is routine or already public, or if they do not contribute a unique interpretation or analysis to a news product.
  • Domestic employees who live-in.
  • Drivers, driver's helpers, loaders and mechanics, if:
    • they are employed by a motor carrier or a motor private carrier;
    • the employees duties affect the safety of operation of the vehicles in transportation of passengers or property in interstate commerce or connected with an interstate terminal (rail, water, air or land) or foreign commerce. The safety affecting employees who not make actual interstate trips is still exempt if the employer has involvement in interstate commerce, the employee could aspect to make an interstate journey.
    • they perform duties on commercial motor vehicles which are vehicles designed or used;
      • with a gross vehicle weight of at least 10,001 pounds or greater;
      • to transport more than 8 passengers including the driver;
      • to transport hazardous material, requiring placarding under regulations prescribed by the Secretary of Transportation.
  • Employees of certain Seasonal and Recreational establishments, if:
    • the employer is an amusement or recreational establishment - for example he concessionaires at amusement parks and beaches - if it:
    • does not operate for more than seven months in any calendar year, or during the preceding calendar year, its;
    • average receipts for any 6 months of the year are not more than 33 1/3 percentum of its average receipts for the other 6 months of such year;
    • NOTE: central functions of an organization operating more than one such establishments - as in the case of employees of a central office, warehouse, garage - or commissary which serves a chain of exempt "amusement or recreational" establishments are not within the exemption.
    • the employer is a national parks/forests/Wildlife Refuge System.
  • Executive employees, if the employee's:
    • compensation is on a salary basis at a rate not less than $455 per week;
    • ownership is at least a bona fide 20-percent equity interest in the enterprise in which he/she is employed, regardless of the type of business organization and who is actively engaged in its management;
    • primary duty is managing the enterprise, or managing a customarily recognized department or subdivision of the enterprise;
    • is directing customarily and regularly work of at least two or more other full-time employees or their equivalent;
    • authority is to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight.
  • Farm implement salespeople.
  • Federal criminal investigators.
  • Firefighters working in small (less than 5 firefighters) public fire departments
  • Fishing.
  • Forestry employees of small (less than 9 employees) firms.
  • Fruit and vegetable transportation employees.
  • Highly-Compensated Workers, if
    • the employee earns total annual compensation of $100,000 or more which includes at least $455 per week paid on a salary basis. This annual compensation could  consist commissions, nondiscretionary bonuses and other nondiscretionary compensation, but does not include credit for board or lodging, payments for medical or life insurance, or contributions to retirement plans or other fringe benefits;
    • the employee’s primary duty includes performing office or non-manual work; and;
    • the employee customarily and regularly performs at least one of the exempt duties or responsibilities of an exempt executive, administrative or professional employee.
  • Homeworkers making wreaths.
  • Houseparents in non-profit educational institutions.
  • Learned Professional employee, if
    • the employee is compensated on a salary or fee basis at a rate not less than $455 per week;
    • the employee’s primary duty must be the performance of work requiring advanced knowledge, defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment;
    • the advanced knowledge must be in a field of science or learning, such as: aw, medicine, theology, accounting, actuarial computation, engineering, architecture, teaching, various types of physical, chemical and biological sciences, pharmacy and other occupations that have a recognized professional status and are distinguishable from the mechanical arts or skilled trades where the knowledge could be of a fairly advanced type, but is not in a field of science or learning, and;
    • the advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction - that is the appropriate academic degree or advanced knowledge through a combination of work experience and intellectual instruction.
  • Livestock auction workers.
  • Local delivery drivers and driver's helpers.
  • Lumber operations employees of small (less than 9 employees) firms.
  • Motion picture theater employees.
  • Newspaper delivery.
  • Newspaper employees of limited circulation newspapers.
  • Police officers working in small (less than 5 officers) public pollice departments
  • Outside Sales employees, if
    • the primary duty is sales or obtaining orders or contracts for services or for the use of facilities - for example: selling of time on radio or television, the solicitation of advertising for newspapers and other periodicals, and the solicitation of freight for railroads and other transportation agencies - for which a consideration will be paid by the client or customer; and;
    • the employee must be customarily and regularly engaged away from the employer’s place or places of business. That is at customer's place or business or home, it does not include sales made by mail, telephone or internet unless such contract is used merely as an adjunct to personal calls. Promotional work can be exempt if it is incidental to and in conjunction with an employee's outside sales or sollicitations. If it's incidental done by someone else it is not exempt outside sales work.
  • Radio Station employees in small markets.
  • Railroad employees.
  • Seamen on American vessels.
  • Seamen on other than American vessels .
  • Sugar processing employees.
  • Switchboard operators.
  • Taxicab drivers.
  • Television station employees in small markets.
  • Truck and trailer salespeople.

Source Overtime provision Exemptionsfor Executive, Administrative, Professional, Computer & Outside Sales Employees

Bill Could End Overtime for More IT Workers

If Congress passes a new bill (S. 1747), overtime pay may be over for a lot of IT workers. The legislation would expand the definition of the Fair Labor Standards Act's (FLSA) exemptions for employees entitled to overtime pay. The law currently only exempts certain IT workers - see in the left column under Computer professionals - the new bill would "exempt any employee working in a computer or information technology occupation". This would greatly expand the number of exempt computer professionals.

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