Many employers in New Jersey classify certain workers as exempt employees. While statutory, non-exempt employees are entitled to overtime for hours worked beyond 40 in a week under the Fair Labor Standards Act (FLSA), exempt employees are not. The FLSA mandates that most employees should also be paid the minimum wage. Since New Jersey’s state minimum wage is substantially higher than the federal minimum wage, non-exempt employees must be paid at the state’s higher rate.
While receiving a salary is one requirement for being classified as an exempt employee in most cases, receiving a salary by itself does not mean that you are not entitled to overtime pay. Receiving a salary is only one factor that is used to determine your status as an exempt or non-exempt employee under the FLSA and the laws of New Jersey. Here is what you need to know from the attorneys at Swartz Swidler.
Classification of Employees
Employers might classify some employees as exempt while classifying others as non-exempt. While your employer might claim that you are an exempt employee, it will not have the final say on your proper job classification. Some employers misclassify employees to try to avoid having to pay them overtime. If you have been misclassified as an exempt employee, you might be entitled to pursue a wage and hour claim to recover the overtime compensation you should have been paid for the additional hours you’ve worked.
Minimum Earnings for Exempt Employees
An employee must receive a salary of at least $684 per week to be considered exempt under rules from the Department of Labor. If you are paid a salary and make less than that per week or under $35,568 per year, you are not exempt and are entitled to receive overtime pay.
The former threshold salary amount was $455 per week. Under the Obama Administration, the Department of Labor tried to raise the threshold to $921 per week. However, the Trump administration retracted that rule and instead set it at $684 per week where it remains. In June, the Biden Administration announced the Department of Labor intends to issue a proposed rule to update the minimum threshold salary for exempt workers, but it has not yet been released. It is unknown what the anticipated salary increase might be or whether it will stand in face of the impending Republican takeover of the House of Representatives.
Being paid a salary of at least $684 per week is not the only factor that determines an employee’s exempt classification. The DOL also considers additional factors related to the duties of the employee’s job. Administrative, professional, and executive employees might be classified as exempt as well as certain computer professionals.
In general, an exempt employee must have high-level duties with decision-making authority over other employees or have creative responsibilities. They must be able to act independently and supervise others. However, other requirements can make the determination more complex.
The following job classifications have qualifying duties and might be exempt from overtime requirements:
- Professional, administrative, and executive employees
- Computer employees such as software engineers, system analysis, and others
- Outside sales personnel
- Employees in certain religious roles
- Certain hotel and agricultural workers
Salaried employees must meet specific tests under each of these categories to be classified as exempt under one of them. Even if an employee is not classified in one of these categories, they might still be exempt if they receive a salary and earn substantially more than a typical employee even if they don’t fully meet the tests for one of the above-listed categories.
Effect of Job Duties on Eligibility for Overtime
Even if your job title indicates you might fall into an exempt category, it does not determine your status alone. For example, administrative assistants will still be entitled to overtime if they do not have duties involving providing input into important business decisions. A restaurant assistant manager might not be an exempt executive if their primary duties involve food sales and they don’t have traditional duties to supervise other employees, including the ability to hire and fire.
Employees who are misclassified as exempt by their employers are entitled to be paid overtime pay for each hour worked beyond 40 and to receive at least the minimum wage. If an employee misclassified as exempt is provided a salary but regularly works 60 hours per week, this would mean that they would be entitled to receive the overtime premium for the 20 additional hours they work beyond 40 each week.
The overtime premium is one-and-one-half times the regular hourly rate. If you have been misclassified and have not received the payments you deserve, you are entitled to pursue a claim against your employer to recover all of the compensation you are owed.
Get Help From Swartz Swidler
Being classified as an exempt employee might make you believe that you are not entitled to overtime compensation. However, if you do not meet the definitions of an exempt employee for your job duties and classification, you might have been misclassified either purposely or unintentionally and should seek the help of an experienced employment lawyer. The attorneys at Swartz Swidler represent employees that are both paid by the hour and by salary to recover unpaid overtime premiums and the minimum wage. These wages can be recovered whether or not your employer’s misclassification was intentional or unintentional. To learn more, call us for a free consultation at (856) 685-7420.