The Fair Labor Standards Act (FLSA) is a federal law through the Department of Labor (DOL) that establishes labor standards for public and private sector employers. The law defines a standard work week, establishes a national minimum wage and establishes parameters for working minors. In addition, the law guarantees overtime for certain positions.
The FLSA provides a set of standards to determine which jobs are covered by the act (“non-exempt”) and which jobs are not covered (“exempt”):
- Non-exempt positions are considered hourly positions and must receive overtime pay or compensatory time for hours worked over 40 in a workweek.
- Exempt positions are considered salaried positions and do not normally receive additional compensation for overtime work.
To qualify as exempt, an employee must satisfy the following three tests:
- Have a salary above the minimum salary threshold;
- Be paid on a “salary basis;” and
- Perform duties that qualify for an exemption.
Exemption Status Changes
Employees may change exemption status for various reasons. Information below is for employees who have been informed by their local Human Resources (HR) unit that their FLSA status may change. Â If you have questions about your specific situation you will need to contact your local HR unit.
Definitions
Exempt status: Exempt positions are considered salaried positions that do not normally receive additional compensation for overtime work. Employers pay you a salary instead of an hourly wage.
Non-exempt status: Fair Labor Standards Act (FLSA) regulations protect your position. By state and federal law, you must receive overtime pay if you work more than 40 hours in a work week. Employers pay you on an hourly basis.