In FLSA Does "Administrative" include the administrative assistant?

TABHR

I have someone questioning whether administrative assistants are exempt from overtime.  They do work for the owners of the company, and do not have anyone working for them. They work for the office manager of the company. Salary range is $40,000 to $48,000 per year.  They have no or little discrimination over company policies.    While they often do not work overtime, this is an accounting firm where they do  work a great deal in the first quarter of the year.

Should they be paid overtime or are they "Administrative"?

IT HR

The administrative exemption is based on two things:

1. Salary test (this person passes this)
2. Duties test (this person may or may not pass this)

Based on your posting I would say they are non-exempt and should be paid overtime, but the answer is really going to depend on the level of independent judgement and discretion this person has.  Do they handle matters related to financial information for the business?  Do they make decisions on behalf of the Owners in their absence? And so on...

Here is information from the dol.gov website - Fact Sheet #17C related to FLSA

 
Administrative Exemption
To qualify for the administrative employee exemption, all of the following tests must be met:


• The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
 
• The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and
 
• The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.
Primary Duty
"Primary duty" means the principal, main, major or most important duty that the employee performs. Determination of an employee’s primary duty must be based on all the facts in a particular case, with the major emphasis on the character of the employee’s job as a whole.
Directly Related to Management or General Business Operations
To meet the "directly related to management or general business operations" requirement, an employee must perform work directly related to assisting with the running or servicing of the business, as distinguished, for example from working on a manufacturing production line or selling a product in a retail or service establishment. Work "directly related to management or general business operations" includes, but is not limited to, work in functional areas such as tax; finance; accounting; budgeting; auditing; insurance; quality control; purchasing; procurement; advertising; marketing; research; safety and health; personnel management; human resources; employee benefits; labor relations; public relations; government relations; computer network, Internet and database administration; legal and regulatory compliance; and similar activities.
Employer’s Customers
An employee may qualify for the administrative exemption if the employee’s primary duty is the performance of work directly related to the management or general business operations of the employer’s customers. Thus, employees acting as advisors or consultants to their employer’s clients or customers — as tax experts or financial consultants, for example — may be exempt.
Discretion and Independent Judgment
In general, the exercise of discretion and independent judgment involves the comparison and the evaluation of possible courses of conduct and acting or making a decision after the various possibilities have been considered. The term must be applied in the light of all the facts involved in the employee’s particular employment situation, and implies that the employee has authority to make an independent choice, free from immediate direction or supervision. Factors to consider include, but are not limited to: whether the employee has authority to formulate, affect, interpret, or implement management policies or operating practices; whether the employee carries out major assignments in conducting the operations of the business; whether the employee performs work that affects business operations to a substantial degree; whether the employee has authority to commit the employer in matters that have significant financial impact; whether the employee has authority to waive or deviate from established policies and procedures without prior approval, and other factors set forth in the regulation. The fact that an employee’s decisions are revised or reversed after review does not mean that the employee is not exercising discretion and independent judgment. The exercise of discretion and independent judgment must be more than the use of skill in applying well-established techniques, procedures or specific standards described in manuals or other sources.
Matters of Significance
The term "matters of significance" refers to the level of importance or consequence of the work performed. An employee does not exercise discretion and independent judgment with respect to matters of significance merely because the employer will experience financial losses if the employee fails to perform the job properly. Similarly, an employee who operates very expensive equipment does not exercise discretion and independent judgment with respect to matters of significance merely because improper performance of the employee’s duties may cause serious financial loss to the employer.

 

TXHRGuy

There are two salary tests.

First is the salary basis test -- is the individual paid on a salary basis?  Assuming you know exactly what that means in the regs, you are OK.

Second is the salary threshold test -- is the individual's salary at least $455 per week?

.....

Either way, administrative assistants usually are not but executive assistants usually are.