FLSA Exempt Salaried Professional
HRroadstar
1 Post
Let's talk about FLSA Exempt Salaried Professionals, specifically, an HR Manager. Normal work hours are 8-5, M-F; 40 hours. Now I know that this HR Manager would be exempt from the overtime provisions of FLSA, but I am not clear on any type of compensation when working more than 40 hours. I have heard some say that exempt, salaried employees do not get any sort of compensation for working more than 40 hours because exempt, salaried employees are just that....exempt from FLSA. I have heard others say that while they do not get paid OT for hours worked past 40 hours, they get compensated for equal time off with pay (meaning if they work 10 hours in a day, they might be able to leave work the next day 2 hours early or come in 2 hours later).
Comments
You do not have to pay your employees overtime or offer any sort of "comp time."
They are exempt from the FLSA, so you can even have them work a regular 60 hour week for their salary and it is not a violation of the law. You can tell them to be in at a certain time and leave at a certain time, even if it is over 40 hours.
As for offering comp time to exempt employees, that is up to the employer and a matter of company policy.
Hi all,
I'm new here so excuse me if I don't get this quite right. I work for a CPA firm and a lot of firms offer comp time because of tax season. Work 60-70 hrs a week during tax season and get Fridays off Memorial Day to Labor Day. My firm requries 50 hours a week for tax season and 1/2 days on Friday Memorial Day to Labor Day. We also get very flexible schedules during "off" months. So I guess I'm trying to agree with the others who have posted and show the variations that can happen depending on the employer.
Hi, there. A couple of things I wanted to mention for you to consider - first, it's not uncommon for exempt personnel to be compensated at a straight time rate for hours in excess of 40 in a workweek. I have seen this done with production supervisor positions. However, for an HR Manager, I think its probably pretty rare unless you work for a small company and are in a lower pay scale - like under 40k.
Also, true "comp time" is time that is deferred compensation. In other words, you work, but don't get paid until later. You are deferring your compensation to a later time. It's helps the employer and the employee during crunch times. However, it's not legal in the private sector.
Our company does a form of "comp time" where exempt employees that work additional hours can take time off later. For example, a manager that works all weekend, might take Monday and Tuesday off with his/her family.
Good luck!
Also, true "comp time" is time that is deferred compensation. In other words, you work, but don't get paid until later. You are deferring your compensation to a later time. It's helps the employer and the employee during crunch times. However, it's not legal in the private sector.
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Not true. In the private sector you most certainly can give comp time - to EXEMPT employees. DoL doesn't care how you pay the employee or what bucket of money the salary comes from, as long as you pay the employee their salary for every week they work.
I still get confused because of my particular employer's policies. We are mostly salaried exempt employees here and our salaries are based on a minimum 40 hour work week. We get paid no more for working 50-60 hrs than we do for 40 hours and we have no comp time policy. However, if we don't actually work 40 hrs per week we are asked to use sick or vacation time to get to the 40 miniumum. I thought salaried meant no matter how much (or little) we work we get the salaried amount, however if for example I were to work only 30 hrs a week and didn't have any sick/vac time to use my check would be prorated). I think there's something screwy about this and am concerned about possible legal ramifications. What do you all think?
Salaried employees are NOT paid for any hours worked over 40 just as their salary is not docked if they work onlly 4 hours one day. That is why they are salaried. However, if they miss one full day of work due to personal reasons other than their own illness and have to paid time off available, you do not pay them for that day.
Also, you are talking about comp time with the 2 hour situation. Our company does not abide by that policy. Salaried employees are expected to put in whatever hours it takes to get the job done.
[quote user="6281518"]Exempt personnel should be docked in full-day increments, not hourly.[/quote]
There is a big difference between docking somone's salary and docking someone's leave bank. You can't dock an exempt employee's salary for working less than 40 hours. You CAN "dock" an exempt employee's leave bank or sick leave bank. That is 100% perfectly legal under federal DoL. (I have a niggling suspicion that CA has something weird about docking leave banks, but I'll have to look it up, I'm not a pro in CA).
Our company policy is that if you work less than your standard workweek and you are an exempt employee, you record PTO for that time. So if you work 35 hours and take 5 hours off your timesheet reflects 35 regular hours and 5 PTO hours.
Using dhall111's example above, what if an exempt employee has exhausted all their PTO, but is short 3 hours of work one week. At that point the employer can dock the paycheck, correct? We don't have that situation currently, but I know an employer that does it that way.
"Using dhall111's example above, what if an exempt employee has exhausted all their PTO, but is short 3 hours of work one week. At that point the employer can dock the paycheck, correct? We don't have that situation currently, but I know an employer that does it that way. "
Possibly, in this situation, unless the employee missed one full day OR was on intermittent FMLA, the employer could NOT dock pay even if the employee ran out of PTO. It is possible that the employee missed one full day and then worked 9 1/4 each of the other 4 days to get to a total of 37 hours.
"Deductions from pay are allowed:
When an employee is absent from work for one or more full days for personal reasons other than sickness or disability;For absences of one or more full days due to sickness or disability if the deduction is made in accordance with a bona fide plan, policy or practice of providing compensation for salary lost due to illness; ..." http://www.dol.gov/elaws/esa/flsa/overtime/cr4.htm
Making deductions to an exempt employee's pay or leave banks in increments of less than one full day (except for FMLA related absences) provides affected employees with ammunition to challenge their salaried status, potentially resulting in expensive litigation and back pay penalties for unpaid overtime. It's a really, really bad idea.
Also, almost nobody is exempt from FLSA. The term "exempt" refers to them being exempt from the overtime and minimum wage provisions of the FLSA.
Making deductions to an exempt employee's pay or leave banks in increments of less than one full day (except for FMLA related absences) provides affected employees with ammunition to challenge their salaried status, potentially resulting in expensive litigation and back pay penalties for unpaid overtime. It's a really, really bad idea.
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I respectfully disagree. DoL has issued many opinion letters that touch on this topic. And opinion letter FLSA 2005-7 specifically states that an employer may deduct a PTO bank in any increment including partial days without affecting the exempt status.
http://www.dol.gov/esa/whd/opinion/FLSA/2005/2005_01_07_7_FLSA_PaidTimeOff.htm
This very thing was actually being discussed in he benefits and leave section. There are certain courts that have not accepted the hour by hour deduction as of 2006 white papers from various professional sites. I have not seen a 2007 update, which suggests the matter is not yet resolved. I recommend that people check with counsel to understand what their circuit has to say on the matter.
http://community.blr.com/hr/forums/thread/2535.aspx
dhall111 - hoping you might specifically see this.... or someone with similar experience....
We have recently begun working on government projects where they are willing to pay OT. Our employees are exempt Professionals and I was concerned about jeopardizing their exempt classifications if we did pay OT. You mentioned you are paying straight time to your employees working on government contracts. Can you advise me on any special considerations before implementing a similar practice?
[quote user="cb499"]If I understand the opinion letter, you can deduct incrementally from a positive PTO balance. If the balance is negative and the absense is less than a day, full salary must be paid. Is a policy allowing an employee to "go in the hole" on their PTO balance therefore allowable as long as they continue to receive full pay? Does allowing a negative PTO balance help to ensure the employee doesn't abuse the exempt status?[/quote]
Yes, you can let PTO / Vacation / Sick Leave banks go in the negative. Of course, the employer is left holding the bag if they aren't accrued up in the black again before separation from the Company. The comments I made in the other thread based on 2006 white papers from SHRM still apply: to my knowledge, this has not been challenged and there is reason to think that it might fail when challenged in some circuits:
http://community.blr.com/hr/forums/thread/2535.aspx
dhall111 - hoping you might specifically see this.... or someone with similar experience....
We have recently begun working on government projects where they are willing to pay OT. Our employees are exempt Professionals and I was concerned about jeopardizing their exempt classifications if we did pay OT. You mentioned you are paying straight time to your employees working on government contracts. Can you advise me on any special considerations before implementing a similar practice?
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Hi hazzard,
When we have contracts that allow employees to be paid additionally for hours over 40 (or 45, depends on the contract) they're generally time & material contracts. When an employee works on those type contracts the manager simply discusses this with them. There is a separate pay code we set up for them to charge to and this flows into timekeeping so they are paid for those hours. We have in our policy that we do pay straight time for additional work on specific contracts only. I've gone through several DoL audits, as recent as last year, and every auditor has been perfectly fine with this. We just can't reduce the salary below their normal weekly salary.