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Overtime pay

Are managers on hourly pay entitled to overtime in Florida?

Employers in Florida are subject to the federal Fair Labor Standards Act (FLSA). Under the FLSA, employees are classified as either non-exempt or exempt. Non-exempt means that an employee is subject to the overtime and minimum wage requirements prescribed by the FLSA. Conversely, exempt employees are excluded from such provisions.

Hourly paid or salaried are terms referring to payment methods. Non-exempt employees are paid per hour for each and every hour worked. Exempt employees receive a fixed predetermined salary per workweek. Many managers are considered exempt; however, classification is not based on job titles. It’s based on the employee’s job responsibilities.

To be exempt, an employee must pass all three “tests”, salary level, salary basis, and duties, as outlined by the FLSA.

The salary level test: Employees who are paid less than $23,600 per year ($455 per week) are nonexempt.

The salary basis test: An exempt employee must receive a regular, predetermined amount of compensation each pay period on a weekly, or less frequent, basis. The predetermined amount cannot be reduced based on variations in the employee’s quantity or quality of work. Aside from a few exceptions, an employee must receive the full salary for any workweek during which the employee performs any work, regardless of the number of days or hours worked.

The duties test: An employee who meets the salary level and salary basis tests is exempt only if he/she also performs exempt job duties. The actual tasks of the job are to be evaluated, not the job title. There are three typical categories of exempt job duties titled executive, professional, and administrative.

Job duties are exempt “executive” job duties if the employee regularly supervises two or more other employees, has management as the primary duty of the position, and has some genuine input into the job status of other employees (such as hiring, firing, promotions, or assignments).

“Professionally” exempt work is predominantly intellectual, requires specialized education, and involves the exercise of discretion and judgment. Advanced degrees are the most common measure of this but are not absolutely necessary if an employee has attained a similar level of advanced education through other means and performs essentially the same kind of work as similar employees who do have advanced degrees.

“Administratively” exempt employees provide support to the operational or production employees and have a major impact on the overall business. An administratively exempt employee has the authority to create or interpret company policies, has responsibilities that directly relate to the overall business operation, has the decision making ability to make significant financial impacts, and has the authority to deviate from company policy without prior approval.

It’s always safer to classify an employee as non-exempt. Misclassifying employees as exempt may lead to FLSA violations which can be very costly.

So, a non-exempt hourly paid manager is entitled to overtime wages.

This entry was posted on Friday, April 24th, 2015 at 12:18 pm and is filed under
Compensation, Labor Laws.
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