Exempt from hrly. to salary-prior pay
mgrinnc
6 Posts
Last year our company changed pay structure and changed some employees who were getting an hourly rate to salary. Prior to this the company had considered them exempt, but they were getting paid by the hour for billable hours only, were not getting paid overtime for hours in excess of 40, nor were they getting paid for "admin" time..time that was not billed, except for a straight 8 hrs. per month for nonbillable activities. They had a direct employer-employee relationship, in fact were not allowed to work any other positions prior to management approval.
For example, if they billed 160 hours per month in the following manner:
Week 1 35 hrs.
Week 2 45 hrs.
Week 3 50 hrs.
Week 4 20 hrs.
they would get paid 160 X hrly. rate plus 8 hrs. x hourly rate for nonbillable
Now an employee has come back and said that they should have been paid overtime and for the time they spent on non-billable activity that was in direct relationship to their duties as an employee in that position. This would include paperwork time, phone calls, etc.
What should I do here?
For example, if they billed 160 hours per month in the following manner:
Week 1 35 hrs.
Week 2 45 hrs.
Week 3 50 hrs.
Week 4 20 hrs.
they would get paid 160 X hrly. rate plus 8 hrs. x hourly rate for nonbillable
Now an employee has come back and said that they should have been paid overtime and for the time they spent on non-billable activity that was in direct relationship to their duties as an employee in that position. This would include paperwork time, phone calls, etc.
What should I do here?
Comments
Also, when you say they are now salaried, are they still exempt? Or are they salaried, non-exempt?" You had said that they used to be exempt before the change to salaried status. You don't really say what they're current status is regarding exempt and non-exempt.
They are now salaried exempt. Prior to changeover were considered hourly exempt.
The profession involves someone with a bachelor's degree or higher performing in-home services counseling families.
The issue came up secondary to a competing company changing their pay structure to include the "paperwork" and "admin" time and restricting hrs. to under 40 per week where they had previously been paid only for hrs. billed.
Thanks for the additional information.
I"m still not sure if they qualify for exemption from FLSA overtime (that's time and a half for over 40 hours in a work week).
From what you said in your last post, I thought initially these emplyees may be exmept as domestics, but in thinking about it more, they don't appear to be domestics because you just identify their duties as in-home counseling.
Are these companions of some kind that go into infirmed or elderly person's home and provide companionship during the day as well as some house work, such as making meals and doing laundry. If they are doing this type of "domestic" service, they may be exempt and paid hourly in addition to "counseling" they could meet the requirement for exemption, either paid a salary or as an hourly.
But if they aren't doing any traditionally domestic service in home but are only providing "lay" counseling (I trust not therapy which usually requires a state license), then they must be treated as non-exempts (which would raise a problem for the time they were classified as "hourly, exempts."
While jobs that require advanced degrees in a learned profession such as clinical social work, or psychology, or psychiatry, can be exempt and salaried, from what you put, I don't see that to be the case here, given the fact that thye only have BA's and not the advanced learning in a particular discipline. In fact, just about all white collar jobs have to be salaried if they are to be exempt except ones that are specifically excluded by the law or by the regulations from having to meet the salaried requirements for exemption (I mentioned above lawyers and attorneys as two of them)
I suspect that these positions may be misclassified now as "salaried, exempts" under FLSA.
Take a look at FLSA regulations regarding exemption and salary requirements in the Code of Federal Regulations, volume 29, Section 541.3 (criteria for professional exemption, inlcuding salaried requirement)and Section 552.
Section 541.3 is linked:
[url]http://www.access.gpo.gov/nara/cfr/waisidx_03/29cfr552_03.html[/url]
Section 552 is linked:
[url]http://www.access.gpo.gov/nara/cfr/waisidx_03/29cfr552_03.html[/url]
Since there are probably plenty of details and facts that will help spell out whether these positions are truly salaried exempt or not, it would best for you at this point to review the regs as much as you are able to and least get a framework for the issue.
If the regs themselves become too confusing (and they can be) try the US Department of Labor's website for the "FLSA e-law Advisor" and go through the interactive selections.
[url]http://www.dol.gov/elaws/flsa.htm[/url]
After you take a look at them, come back and let us know how you view the situation in view of the above regulations.
This is just one person's non-lawyer opinion.
Our HR person was really not a lot of help and as I was considered a "contract supervisor" I felt that some of the responsibility was mine to make sure we had been correct.
So....I bit the bullet and call our Wage and Hour District Office. They are super nice by the way and don't ask who you work for or anything. Gave him the facts of the case and he said, based on the proposed regulations, that their division would not do anything about it. These individuals would be considered professionals, etc. He went on to say that the individual could probably contact an attorney and file a private suit and might have a stab at a claim, but that they would likely not investigate the claim.
Thanks!!