Who Gets Overtime?

A fellow member of the New York State Bar explains nicely who is and is not entitled to overtime compensation for work in excess of forty hours a week under the Fair Labor Standards Act (calculating when one work more than forty hours is something of a technical exercise, as is implementing any alternative to the normal time and a half pay form of compensation).

In a nutshell, employees are entitled to overtime unless they are exempt and:

Some jobs are classified as exempt by definition. For example, "outside sales" employees are exempt ("inside sales" employees are nonexempt). For most employees, however . . . to be exempt an employee must (a) be paid at least $23,600 per year ($455 per week), and (b) be paid on a salary basis, and also (c) perform exempt job duties. . . . There are three typical categories of exempt job duties, called "executive," "professional," and "administrative."

Executives are essentially line managers. Someone is an executive if he or her (1) regularly supervises two or more other employees, and also (2) has management as the primary duty of the position, and also, (3) has some genuine input into the job status of other employees (such as hiring, firing, promotions, or assignments).

"Professional" has something close to its common sense meaning. Among those included are "lawyers, doctors, dentists, teachers, architects, clergy . . . registered nurses (but not LPNs), accountants (but not bookkeepers), engineers (who have engineering degrees or the equivalent and perform work of the sort usually performed by licensed professional engineers), actuaries, scientists (but not technicians), pharmacists . . . actors, musicians, composers, writers, cartoonists, and some journalists."

Administrative encompasses both individuals who would ordinarily be consider part of management in a staff position despite not supervising many people (such as a purchasing executive in a large retail business) and people who could be called variously office managers, administrative assistants or executive secretaries whose jobs have significant executive, managerial or professional elements, despite not fitting squarely into one of those categories. Straight clerical work, however, of the type done by a typical secretary or receptionist or bookkeeper is not exempt.

The new regulations clarify a host of confusing issues under prior law, and have been around long enough to be fairly widely understood.