Overtime Pay Legal Considerations?

Answer:   As you know we are not lawyers and do not provide legal opinions.  The comments that we offer on legal topics are not based on any legal qualifications and should not be considered as anything other than general feedback. Our ability to find information that is directly responsive to legal and regulatory questions is limited to referencing documents published by the government or other sources. While we can provide you with information on federal and state labor laws like that below, to clarify whether your salaried salesperson can work “6 days a week, 9 hours a day” without legal repercussions for your business, you will need to consult a local labor lawyer.

We do not know why this employee wants to work 54 hours per week without additional compensation.  Nor do we know all the details of the employee’s job responsibilities; however, unless you have determined that he is exempt from the overtime pay requirements under federal and state labor law, he will not be able to work 54 hours per week without overtime compensation even if he elects to do so voluntarily.

Whether an employee can work over 8 hours per day in your state and over 40 hours per week without overtime compensation will depend on whether the employee is subject to the minimum wage and overtime pay provisions of the Federal Fair Labor Standards Act (FLSA) or state law if it is more restrictive. The FLSA is the federal law that mandates a federal minimum wage and overtime pay for covered employers and employees. Most businesses are subject to the FLSA and/or state laws that require employees be paid minimum wage and overtime pay.

Under the FLSA, employees are categorized as exempt or nonexempt. The method of payment—salary, hourly, piece rate, or commission, etc.—does not determine an employee’s status in regards to being exempt or nonexempt. An exempt employee is an employee who is not subject to the FLSA based on qualifying for one of the exemptions from coverage under the FLSA. A nonexempt employee is an employee who is subject to the FLSA and its minimum wage, overtime and other provisions. Basically, determining whether your employees are exempt or nonexempt employees will require an examination of their job duties and pay levels.

Under the FLSA, a nonexempt employee may be paid on an hourly, salaried, piece rate, or commissioned basis, as long as they receive at least minimum wage for all hours worked and the appropriate overtime pay. Nonexempt employees must be paid for each hour that they work, regardless of the activities they perform for their employers during those work hours. Exempt employees, particularly those who qualify under the FLSA’s executive, administrative, or professional exemption, usually are paid on a salaried basis and are not required to receive overtime pay. Exempt employees are paid their salaries regardless of the number of hours they work for their employers during the work week or what activities they perform for their employers during those work hours. You can review discussions on the FLSA and how to determine whether an employee is exempt or nonexempt at the following websites:

• Managing Employees in the Workplace: paychex.com
• What is the Difference Between Exempt and Non-Exempt Employees: allbusiness.com
• Exempt vs. Non-Exempt Employees: hrhero.com
• Exempt Employee vs. Non-Exempt Employee: about.com

Department of Labor information on the FLSA and federal minimum wage and overtime pay requirements can be found at the following websites:

• The Fait Labor Standards Act: dol.gov
• Fair Labor Standards Act Advisor: dol.gov
• Wages: dol.gov