What is an "exempt" employee? Email
Tuesday, September 13, 2016 04:00 AM

Time clockThere is a lot of talk about the upcoming changes to the federal overtime rules. The changes are coming soon—employers must be in compliance on December 1 this year. But it seems that many employers haven’t yet paid much attention. Perhaps one reason is that they don’t believe the rules apply to small businesses or to family-owned businesses. That’s a misconception—the Fair Labor Standards Act (FLSA) applies to just about everyone.

Another point of confusion may center around the employees and their status as exempt from overtime. Simply being a salaried employee does not make one exempt from overtime pay. In addition to the salary test, an employee must meet certain “duties tests” to qualify as exempt. In other words, if the duties of a job do not meet the requirements set forth by the FLSA, an employee is entitled to overtime pay despite being salaried.

The new federal overtime rules apply to employees often referred to as “white-collar workers.” These jobs require a high level of discretion, critical thinking, and often require advanced training or a college degree. The jobs often involve hiring or managing one or more employees.

The exemptions do not apply to manual laborers or other “blue collar” workers “who perform work involving repetitive operations with their hands, physical skill and energy,” according to the Department of Labor. These jobs include production, maintenance, construction and similar occupations. If your landscape foremen are in the field working alongside the laborers they supervise, they may be eligible for overtime despite being salaried. 

For jobs such as foreman, whose duties appear to fall into a gray area, it might be valuable to consult with a lawyer or human resources expert to be sure that your job descriptions and compensation categories are in compliance with FLSA and the new federal overtime rules. Spending the time and money now to be sure you are following the rules correctly could save you substantial penalties in the future.

Read more in this issue of Colorado Green NOW:
The ELITE Awards nominations open soon
Marketing your open positions
Time for a pruning primer (VIDEO)
How Summit Services' Mark Frederick reinvents the walkthrough