Employment and Labor Laws

Fair Labor Standards Act

Exemptions

Exempt Employees

Employers do not need to pay employees the mandated minimum wage rate and/or overtime if there is an applicable statutory exemption. The Fair Labor Standards Act provides for two categories of exemptions: (1) those that exempt employees from both minimum wage and overtime requirements and (2) those that exempt employees from only the overtime requirements. For a discussion of those requirement, visit:

Currently, the misclassification by employers of employees as exempt is one of the most active areas of enforcement for the US Department of Labor. If you are an employer, you need to make sure you current employees that are classified as exempt are truly exempt. Employers that improperly classify employees as exempt are generally required to reimburse the improperly classified employees for the income lost due to the improper classification. Employers may also be subject criminal prosecution and fines up to $10,000 or $1,000 per violation depending on the willfulness of the violation.

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