New minimum salary requirement

System

Some of our exempt staff members do not make the newly mandated $455 per week in base pay. However, each month, they recieve commissions that, when factored in with their base pay, would have them meeting or exceeding the $455 threshold if calculating thier pay on a weekly average basis. Their annual income well exceeds the $23,660/yr level, but there are months when their commissions are minimal or even $0. Can I rely on a annual salary, inclusive of commisions to keep them exempt, or do they have to meet the $455 weekly salary basis, regardless of bonuses or commissions?

Al Vreeland

Generally speaking, they must meet the salary threshhold without respect to any conditional or contingent payments.

If they are involved in sales, you may wish to consider the outside sales exemption or the retail/service establishment exemption for commission paid employees.


Al Vreeland
Editor, Alabama Employment Law Letter
Lehr Middlebrooks Price & Vreeland, P.C.