Salaried, Non-Exempt

njjel

If an employee is salaried, non exempt and they work a 35 hour work week they are not paid for hours 36-40 but are paid o/t for those over 40, correct? There is a "discussion" going on here about that.

ray a

My understanding is if they are non-exempt, they must be paid for every hour they work including OT for hours in excess of 40. But, being classified as salaried implies they will be paid a minimum of 35 hours unless for special circumstances. Salaried non-exempt is a difficult classification.

David Nagle VA

This is determined by the agreement with respect to the salary.

If it covers a 35 hour week only, then you can determine the regular rate by dividing salary by 35. The person must get at least minimum wage, but should get the regular rate, for each hour between 35 and 40, and one and one-half times the regular rate for hours over 40.

If the salary covers hours up to forty per week, although the employee is only required to work 35 hours in most weeks, then the regular rate is the salary divided by 40. Nothing extra is due for workweeks up to 40 hours, and one and one-half times the regular rate is due for hours above 40.

Pork

"FIXED SALARY FOR A FLUCATING WORK WEEK" IS BASED ON THE TOTAL NUMBER HOURS AGREED TO; WHEN THE WORK IS DONE IN LESS THAN THE AGREED TO NUMBER OF HOURS THE COMPANY GOT THE BENEFIT OF MORE EFFICIENCY. IF THE EE WORKS GREATER THAN THE AGREED AMOUNT OF TIME, THEN YOU MUST FIGURE IN THE ADDITIONAL HOURS AS ADDITIONAL OVERTIME HOURS. You see,the salary is identified based on a calculation of a pro-conceived number of hours + overtime hours that you would expect the position work in a normal week. Once you find the agreement is not meeting your company goals for this position then change the agreement and adjust the salary.

AN AGREEMENT LIKE THIS CAN BE WORKED UP FOR ANY SET OF HOURS AND SALARY WHICH EQUALS A BASE RATE OF PAY. I HAVE TWO POSITIONS WORKED UP WITH 50 HOURS BEING THE TIME ESTABLISHED TO PAY A CERTAIN SALARY. IF YOU HAVE YOUR BASE RATE SET AT 40 THEN THE COMPANY WILL ALWAYS LOOSE MONEY BECAUSE YOU HAVE ACCEPTED THE RISK OF THE EE WORKING MORE EFFICIENTLY AND FINISHING BEFORE THE 40 HOURS IS USED. WHY HAVE THIS SITUATION AT ALL? PAY BY THE HOUR and let your computer do the figuring.

PORK

njjel

Our standard work week is 35 hours per week for everyone. So if the salary is $450/week and she works 36 hours and is classified salaried, non-exempt I believe she is still paid the $450 that week. However, if she works 41 hours she then receives $450 plus one hour at time and a half??

San Francisco

I am not familiar with this classification, but if the employee is non-exempt I would think that you must pay for every hour worked above the usual hours. In your examples, you have the person working 5 hours over the 35 with no compensation and then give them ot for the 6th hour - the 41st. I just don't think that is legal.

Elizabeth

Pork

NJJEL:The rate of pay is thus set at $12.50 per hour, if you allow the employee to work the 36th hour, 37th, 38th, 39th, and 40th hour I do believe that you would be required to adjust the employee's pay for 5 addition hours of work at $12.50 and hour with the 41st hour being paid at the $18.75 rate.

I may be wrong but I do not find the paragraph in my set of regulations that tells me how to successfully cheat an ee out of money earned for hours worked simply by paying someone a salary. The only way that I have found to realistically and legally get away without paying non-exempts by the hourly rate is the FIXED SALARY FOR A FLUCTUATING WORK WEEK!

PLEASE PUBLISH YOUR INFORMATION FROM THE REGULATION, Because this old HR has never been able to find the right and proper way of getting around a headache of calculating minutes and hours against a certain hourly payrate for non-exempts!!!

PORK

njjel

I have no quote from the regs. Thus my posting here. I have always been under the impression that there is a classification of salaried, non-exempt! Guess not eh?????

David Nagle VA

An employee may certainly be salaried, and non-exempt. Salary basis compensation does not relieve an employer of the obligation to pay overtime compensation to a non-exempt employee.

The fixed salary for fluctuating workweek, mentioned in a post above, is permissible, but very uncommon. When the employee works over 40 hours per week, especially if it varies week to week, the calculations can be extremely burdensome and, as the regular rate drops the more hours the employee has to work, it may be very unpopular with workers. Workers almost always believe it is unlawful, and therefore in my experience the practice generates complaints to the department of labor. Even though the method of compensation is permissible, few of us want to do anything to encourage DOL audits.

As noted in my previous post, if the agreement is that the salary covers 35 hours, I would suggest paying the regular rate for additional hours from 35-40, and one and one-half times that rate for hours over 40.

David E. Nagle

marc

We used to have these classifications and further paid twice a month on the 15th and EOM. As a small non-profit, none of the ees seemed to mind. Growth hit us and we exceeded 50 employees and had to grow administratively as well. We finally spent some money on a handbook and our lawyer freaked when she found out about our payroll policies. Long story short, we decided to go back two years and review timesheets (which we had been collecting all along) to determine who and how much overtime we owed. It was very difficult with time sheets cutting off in the middle of the week. Now we have real exempt and non-exempt and pay every two weeks on Friday, with a week delay.

It was a hassle to change over but we are well-protected now and can defend any paycheck.