What is an Exempt Employee?
Employees who are governed by the Fair Labor Standards Act (FLSA) are either “exempt” or “nonexempt.” Exempt employees are excluded from minimum wage, overtime regulations, and other rights and protections afforded to nonexempt employees. Generally, employees who are paid less than $23,600 per year ($455 per week) are nonexempt.
For a position to be exempt, employers must pay a salary as opposed to an hourly wage. In most cases, only executive, supervisory, professional and outside sales positions are considered exempt.
Overtime Implications for Exempt Workers
Exempt employees are typically expected to commit the number of hours needed to fulfill their respective job duties, no matter if that requires 30 hours per week or 60 hours per week. Their compensation does not change based on the actual hours they work.
When exempt employees put in more than 40 hours per week, they are not paid extra. They only get paid for getting the job done. On the other hand, it is mandatory for nonexempt workers to be paid overtime if they work more than 40 hours per workweek.
In conclusion, an exempt worker has virtually “no rights at all” under the FLSA overtime rules.