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Sep30

Can an exempt employee be stepped back to hourly

We recently brought to our exempt employees attention that we need them to work 50+ hours per week to get a special, short term, critical project completed. Some exempts are not working the hours or complain that they have personal reasons (child care/night college classes) that makes it impossible for them to work the requested hours. We feel these folks should not be treated and paid as exempt if they perform as hourly employees. Can we step them back to hourly and non-exempt? We are in Oklahoma.

Changing these employees from exempt to non-exempt is problematic. Frankly, the best practice would be to treat this as a performance problem — which is what it is. Any exempt employee who does not work the expected 50 hours per week would receive a written reprimand. If that did not solve the problem the employee would be suspended without pay and then terminated.

Presumably, you are not telling these folks when they need to work the 50 hours — just that they need to get the work done. That would mean that they need to arrange for childcare, or work during the hours when they do have childcare. The employee who has classes could work on evenings or weekends when class is not in session — even if that were Saturday night at midnight. This is a time when you may have to be a little hard-nosed to let exempt employees know they are expected to get the job done.

You should also make it clear to these employees that their poor performance will be a factor in their annual evaluations.

If you do not take this approach, you are likely to find that all your exempt employees are suddenly available only 35 or 40 hours per week.

There is really no benefit to you, to making these employees hourly. That just reinforces the bad behavior, by granting them overtime if they do work more than 40 hours per week. If an exempt employee was consistently unable to meet your expectation of 50 hours per week, it would be reasonable to demote them to an hourly position and promote another worker.

Making some employees exempt while others in the same job are non-exempt could very well be seen by the US Department of Labor as illegal discrimination. Especially if most of the female employees fall into one group, that could very well be pay discrimination under the Ledbetter Fair Pay Act. And, under that law employees can sue you for unfair pay, even 20 years later.

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This entry was posted on Wednesday, September 30th, 2009 at 6:25 pm and is filed under
Human Resources Management, Performance Management.
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4 Responses to “Can an exempt employee be stepped back to hourly”

  1. Brandy Shirley Says:

    Can an employee be classified as exempt if they are hourly?

  2. Caitlin Says:

    Hi Brandy! No. Under federal law, only employees who are paid the same salary each week, regardless of the number of hours worked, are exempt. HTH, and thanks for reading the blogs!~ Catilin

  3. Sabine Altiery Says:

    Hi, i currently have taken a good time reading your post and basically thought i would have to be courtesy enough to pass comment. i have loved your aticles and i have high hopes you will continue posting it for me and other folks which take pleasure in browsing it.

  4. Caitlin Says:

    Thanks for the kind words, Sabine!~ Catilin

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