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Understand the difference between exempt and nonexempt employees

One of the protection laws that employers have to abide by is the Fair Labor Standards Act (FLSA). Under this act, employees are due specific points, such as overtime pay. As an employer, it is necessary that you think carefully about how you will ensure compliance at your company.

The presence of "exempt" and "nonexempt" in the FLSA throws some employers for a loop. It is imperative that you know how this impacts your company. Typically, this law only covers employees that aren't covered under other labor law provisions. For example, truckers are governed by the Motor Carriers Act and railroad employees are covered by the Railway Labor Act. Additionally, many agricultural employees and movie theater employees aren't covered by the FLSA.

Generally, employees who make below $23,600 are considered nonexempt while those who make more than $100,000 are likely exempt. Inside sales employees are usually nonexempt, but outside sales professionals are probably exempt.

A few other points that can differentiate exempt from nonexempt employees include the specifics of a salary position, the job duties a person is expected to complete, and similar factors. It is imperative that you take the time to review any of these points that might apply to your company because proper classification is imperative, but some positions might be too complex to formulate this classification based on generalizations.

If something happens and an employee brings action against your company for a violation of the FLSA, you need to find out what options you have to protect your business. This can have a considerable impact on the future of the company.

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