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Understanding Why Some Employees are Exempted from Overtime Pay

By Edited Feb 10, 2014 0 0

Employees should receive overtime pay if they have worked for more than 40 hours in one workweek. The amount of this additional pay is one and a half times their basic pay. In addition, it should be provided in wages, not in time off or goods.

Problems may arise when an employer is covered by both state and federal laws. If this situation happens, employers are required to follow the law that entitles their employee to receive a higher amount of overtime pay.

However, some employees are exemptedd from it. People who earn more than $455 a week are not entitled to receive it, especially if they are paid on a salary basis and if their occupation falls under one of these categories:

Administrative workers

Administrative employees are those who are engaged in non-labor or office duties that are connected to the management or operations of their company or the customers that it serves. In addition, they are the ones who use independent judgment or discretion regarding important company matters.

Here are some examples of positions that are included in this category:

· human resource personnel
· office managers
· assistant department managers

Meanwhile, this category cannot be applied to the following:

· secretaries
· cashiers
· clerks

Learned professionals

This category covers employees who are required to do work, which can be accomplished using their knowledge in the field of learning or science. This extensive knowledge is not acquired on the actual job.

Executive workers

Employees who are included in this category include the following:

· employees who are responsible in managing a department or the whole enterprise
· employees who are authorized to hire or terminate other employees
· employees who normally direct the work of their co-employees

Outside sale workers

These are people who obtain or sell contracts or orders for services that were purchased by the customers. In addition, they also spend most of their time away from the company.

Highly compensated workers

This category covers employees who are required to do non-manual or office work and are being paid over $100,000 a year. Before an employee is classified under it, he should have been first required to regularly do one of the duties attached to an exempted administrative, professional, or executive employee.

Aside from the employees who are covered in the categories mentioned above, others who are also exempted from overtime pay include:

· volunteers
· independent contractors
· newspaper deliverers
· some switchboard operators



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