A question employers ask us frequently is whether overtime rates are applicable to all employees, and if not, which employees are exempt?
Properly-designated salaried employees are exempt from overtime. There are exceptions, but the general rule of thumb is that employees whose primary duties concern management of the general business operations of the employer and include the exercise of discretion and independent judgment can be considered salaried employees and properly excluded from the payment of overtime.
A common misconception is that all salaried employees or employees whose job title includes the word “manager” are exempt from overtime pay. In actuality, it is the duties of the employee that determine whether they can properly be excluded from overtime pay, not the job title or whether they receive a regular salary.
The website of the United States Department of Labor Wage and Hour Division offers helpful guidance for determining when an employee should receive overtime pay, and which employees are exempt from the overtime pay law.
Improper application of overtime laws to your employees can result in expensive litigation. Employers should conduct an internal audit at least annually to review employee classifications, particularly in situations where employees’ duties have changed.
Classification of employees in compliance with current wage and hour law is one of the areas where the attorneys at Scolieri Law Group, P.C. can help. Located in western Pennsylvania, our attorneys are experienced in Pennsylvania business law and can help you navigate regulations affecting your business. Contact us today at (412)765-0546 or firstname.lastname@example.org.