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Employees whose jobs are governed by the FLSA are either "exempt" or "nonexempt." Nonexempt employees are entitled to overtime pay. Exempt employees are not. Most employees covered by the FLSA are nonexempt.
The FLSA exemption test refers to the status of a job as outlined in the Fair Labor Standards Act. The FLSA determines whether a job is exempt or nonexempt as it relates to overtime obligations.
To classify an employee's FLSA status, you must answer three questions covering the following areas:Salary basis: Does the employee earn a salary?Salary level: How much does the employee earn per week or year?More items...?
The regular rate is calculated by dividing the total pay for employment (except for the statutory exclusions) in any workweek by the total number of hours actually worked to determine the regular rate. Covered means an employee is protected by the FLSA.
Exempt employees are mostly paid on a salary basis and not per hour. Unlike non-exempt employees, employers may decide whether to pay exempt employees for any extra work outside the official 40 working hours per week. As a business owner, this allows you flexibility in your payment and employee benefits policies.
The learned professional exemption is restricted to professions where specialized academic training is a standard prerequisite for entrance into the profession. The best evidence of meeting this requirement is having the appropriate academic degree.
The FLSA, identifies two types of employees: non-exempt employees and exempt employees: Non-exempt employees are employees who, based on the duties performed and the manner of compensation, are required to account for time worked and sick leave, vacation, and other leave on an hourly and fractional hourly basis.
The four main components or elements covered by the FLSA are: payment of a minimum wage. overtime pay for working 40+ hours in a week. recordkeeping by the employer on employees: accurate information identifying the worker and the hours worked and the wages earned.
Nonexempt: An individual who is not exempt from the overtime provisions of the FLSA and is therefore entitled to overtime pay for all hours worked beyond 40 in a workweek (as well as any state overtime provisions). Nonexempt employees may be paid on a salary, hourly or other basis.
With few exceptions, to be exempt an employee must (a) be paid at least $23,600 per year ($455 per week), and (b) be paid on a salary basis, and also (c) perform exempt job duties. These requirements are outlined in the FLSA Regulations (promulgated by the U.S. Department of Labor).