Exempt or Not Exempt: That is the Question!

In Hamlet’s famous monologue, he openly contemplates whether suffering in life might be worse than death itself.  While the stakes are much lower, it also is debatable whether ’tis nobler to hold an “exempt” position under the Fair Labor Standards Act.

The FLSA ensures that employees in most jobs are paid a minimum wage and appropriate overtime pay for performing work.  Some jobs are “exempt” from the protections of the FLSA, that is, the Act may not apply to them.  While some jobs are exempt by definition, e.g., “outside sales” employees, for most positions whether the employee’s job is exempt depends on how much the employee is paid and what the employee does at work.  As a general default rule, every employee’s job is considered non-exempt and entitled to FLSA protection unless the employer asserts otherwise.  The most often invoked exemptions are the so-called learned professional exemption and administrative exemption.

Putting aside the analytical exercise, the issue of FLSA exemption can present a conundrum for both employer and employee.  Some employees might covet the resume-building cache of an “exempt” position — which proves a level of compensation and can imply a level of responsibility and judgment; but they may subject themselves to longer work hours without overtime compensation by arguing for that position.  And while employers may prefer to call certain employees “exempt” — as a titular accolade meant to attract higher quality workers, doing so could expose them to litigation from other, underpaid employees whose jobs were misclassified.  Confusing things further, it is the employee’s position and duties that primarily dictate whether an exemption applies, and not the employee’s abilities or job history alone.  Therefore, whether an employee’s job is exempt can change over time as their role at a company and their salary and training changes.  Thus, it behooves both employer and employee to honestly and regularly engage in the exercise of properly assessing whether their positions are exempt or non-exempt.

If you are unsure or disagree as to how your employees’ positions should be classified, you need not soliloquize to work it out.  Consult a knowledgeable lawyer for help.

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