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Exempt vs Non-Exempt

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Can someone please explain the difference between Exempt and Non-Exempt Salaried Employees? I'm in Indiana if that makes a difference. Thank you.

[This message has been edited by Sara (edited December 14, 1999).]



"Exempt" employees are those who meet the strict requirements under the fed FLSA and state law so that overtime pay isn't required (i.e., "exempt" employees may be required to work any number of hours each week with no overtime pay).

To qualify as exempt, an employee must ordinarily (1) be paid a salary and (2) meet a "duties" test. Generally, under fed law, exempt employees must either (a) have a professional license/credential, (b) supervise at least 2 other full-time employees, or (c) have the discretion to make up important company policies.

MANY companies erroneously call employees "exempt" merely because they're paid a salary or are called "managers." But, all requirements must be met, AND MANY companies get the rules wrong.

For example, in the last month, both US Bank (in 17 states) and Albertson's grocery store (in 25 states) both settled big lawsuits because they erroneously treated some non-exempt employees as exempt. The bank will pay out $3.8 million, and Albertson's will pay out $38 million. That's right, MILLIONS of dollars are being paid out by companies because they blow the exemption rules.

So, who is exempt in your company and who isn't? That is the million dollar question, and it's not easy to get a precise answer.
But, simply getting paid a salary doesn't make you exempt. Non-exempt salaried people are entitled to overtime after 40 hours in a week.

Mad Mom

My adult daughter was told she by her employer is "salaried" but does not meet DoL guidelines. (She performs routine clerical/administrative duties in a furniture store office.) Her employer says that she is REQUIRED to work 44 hours per week (no overtime) and since she has missed that target (although not being told of it before!) she will be docked for 110 hours. There is no leave earned and whenever she has had a medical appointment or has been sick, she has made up the hours - so much for "salaried". We are in Illinois and ignorant employers seem to be the norm! I'd appreciate any feedback, guidance, etc. from someone wo has gone through this before and survived the issue successfully. What has happened with your issue?

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