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Salaried Exempt in Montana

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Are salaried managers entitled to overtime under federal law in Montana?

Under federal law, there is one category of worker, called “salaried exempt,” which is not entitled to overtime, and another category, “salaried non-exempt,” which has the right to receive overtime pay after 40 hours a week.

Employers are often surprised to discover this fact – that there are, in fact, salaried employees who are entitled to overtime pay, or “time-and-a-half.”

The issue is a complicated one, made more complicated by the fact that some states have passed their own overtime laws that entitle some workers to overtime when they are not entitled under federal law.

The bottom line, however, is that it is not enough merely to label an employee a “manager” to exempt him or her from overtime entitlement. Certain guidelines must be adhered to. The applicable law in this case is the federal Fair Labor Standards Act (FLSA). As many know, the FLSA requires that employees who work more than 40 hours in a week are entitled to 1.5 times their regular pay for all hours over 40.

The question then is, which salaried employees fall into which category? The following are some of the guidelines under federal law for determining which salaried employees are exempt (not entitled to overtime).

Exemption depends partly on job duties. Under federal law, outside sales people, highly compensated employees, executives, professionals with advanced knowledge and degrees, administrative employees, and computer employees are exempt.

An executive is someone who manages two or more employees. An administrative employee is someone who makes significant decisions important to the business. For example, a purchasing agent who chose between vendors would be exempt. The administrative assistant phoning in those orders would be non-exempt. Highly compensated employees are those earning $100,000 or more yearly for non-manual labor.

Professionals with advanced knowledge would include, for example, emergency room doctors and pharmacists. Computer system analysts, software engineers, programmers and the like would be exempt. So would creative professionals such as artists and sculptors. JH