FLSA Overtime Exemptions: Executive Exemption

We previously discussed the Fair Labor Standards Act’s (“FLSA”) requirement for employers to provide their employees with overtime compensation. We also mentioned that the FLSA provides multiple exemptions for overtime compensation. While there are several exemptions that may apply, today we will be focusing on the executive exemption. Neither job title nor payment of wages via a set salary alone are sufficient to qualify an employee for the executive exemption. Rather, a detailed factual analysis must be conducted, which includes, but it is not limited to, consideration of the following factors: 1.) the amount that the employee is paid on a weekly basis; 2.) whether the primary duty of the employee includes managing the enterprise or managing a department or subdivision of the enterprise; 3.) whether the employee regularly directs the work of at least two full time employees or their equivalent; and 4.) whether the employee has the authority to hire/fire other employees or whether the employee’s opinions regarding hiring, firing, and/or promoting his or her subordinates carry significant weight with the final decisionmaker. In addition to the factors listed above, there are other methods in which employees, especially those with a certain percentage of ownership in the business, may qualify for the executive exemption. To determine whether any of your employees qualify for the executive exemption or one of the other exemptions, call the Business Law Group today and speak to an attorney.