Salaried Workers Get Overtime...Sometimes

Author: Joel W. Baar
Date: 10/18/2007

Contrary to popular belief, paying an employee a weekly salary does not necessarily make that employee ineligible for overtime pay. In other words, even salaried employees are entitled to overtime pay, depending on the type of work they perform.
The federal Fair Labor Standards Act says that the duty to pay overtime depends upon the type of work your employees do. Certain employees are overtime exempt if they are employed in a bona fide executive, administrative, or professional capacity or are employed as part of an outside sales force.
Many employers have faced expensive legal battles involving whether or not certain employees are eligible for overtime. A recent lawsuit filed against a national coffee chain, for example, argues that the managers are entitled to overtime pay because they have the same job functions as hourly employees. No decision has been made in this case yet, but the coffee chain is in for a lengthy and expensive battle.
If you have questions regarding whether or not certain salaried employees are entitled to overtime pay, please contact Joel Baar.