Hourly Exempt Employees

Rockie

Could you please explain to me what the benefits of making someone an hourly exempt employee would be? I understand that this means the person is exempt, but can still qualify for overtime? I thought exempt meant they were not eligible for overtime? And could you give me some examples of what type of positions could be considered hourly exempt.

Thanks!

Theresa Gegen TX

I don't know exactly what you mean by "hourly exempt", but I do know that some employers will pay straight time pay (an straight hourly rate) for hours worked over 40 a week to employees who are exempt. The purpose of this is so that the employees will accept promotion to supervisors. The employer that I know who uses this system implemented because the hourly employees (who were covered by a union) would not accept a promotion to supervisor, because on a salary, they would actually work more hours, but be making less because of no overtime. To remedy the situation, the employer implemented straight time pay for hours over 40 for the salaried supervisors. The purpose was so that the supervisors would not make less than they did when they were hourly.

Note: This particular business is feast or famine, so the supervisors will either be working like dogs, or just working 40 hrs a week (or even less). That is why the employer did not just want to raise the salary for all time.

Good Luck!

Rockie

Thanks guys! I thought this was probably something that was used mostly in a manufacturing environment and I have never come across this Wage and Hour designation in an office type environment. In our case, if we did this, all of our managers and supervisors would want this proviso.

valentine

I'm confused ?? :-(

I thought exempt meant you couldn't pay overtime because the employee would lose their exempt status and you'd end up having to go back and pay them as an hourly employee.

We have salaried non-exempt employees at our facility. They are paid a salary but get paid for any hours over 40 worked in a week.

The only exempt employees are Department Directors who get paid regardless of the number of hours worked and we are careful under the Wage and Hour Law not to pay them overtime because of the above.

ritaanz

Our hourly exempt employees are ones that have direct bearing on the cost of manufacturing a product. Our cost accounting system tracks the hours spent in developing, designing, fabricating, etc. the product to our customers specifications. This way we have the necessary information to price the product correctly.

Hatchetman

FLSA requires that emplyees who are exempt from the overtime and minimum wage requires be on salaired status. However, there are very specific exceptions to that which are identified in FLSA:

Computer programmers who are paid at least $27.63 per hour (currently) may be exempt under the "professional" exemption category (otherwise they would have to be salaried).

Physicians, school teachers, and sorry gang, attorneys, do not need to be salaried to be exempt. Thus, they can wind up with the worst of both worlds - being docked pay as hourly but only receiving straight time when they work over 40 hours.

Outside salespeople do not need to be salaried to be exempt. An outside siales person under the regulations makes salres or obtains order or contrcts for services for which a consideraiton will be paid by the customer and is regularly working away form the employer's place of business.

There are other categories of exempt employees based upon the industry in which they work -- such as the motor carrier industry -- or the very specific duties -- such as casual baby sitters or domestic help who proivde companionship to the aged or infirmed. Typically, these individuals are paid on an hourly basis. But on exempt status they would only receive straight time if they worked more than 40 hours in a seek.

Take a look at the United States Code (not the Code of Federal Regulations)- Title 29, Chapter 8, Section 213 identifying the exemptions to the overtime and minimum wage requirements.

[url]http://www4.law.cornell.edu/uscode/29/213.html[/url]

The Code Federal Regulations does provide more information on these exemptions but you have to scroll through several provisions to locate them.

[url]http://www.access.gpo.gov/nara/cfr/waisidx_98/29cfrv3_98.html[/url]

Theresa Gegen TX

The people I was referring to are on salary. In otherwords, they do not get docked when the business is down and they work less than 40 hours per week. It is only when the business is up, that they get extra pay for over 40 hours a week. I am not sure exactly how it is structured, but it may be structured as some time of a bonus when the plant is busy.