Employees Misclassified as Exempt from Overtime

Employees working beyond the standard 40-hour workweek and not earning overtime pay might be victims of misclassification. Misclassifying an employee as exempt is a common strategy employers use to avoid paying overtime wages.

Employee exemption laws can be daunting to navigate. The Fair Labor Standards Act establishes specific criteria for positions exempt from overtime pay. If your job doesn’t fall into these criteria, you could be entitled to compensation for unpaid overtime.

At Yormak Employment & Disability Law, we specialize in employment disputes. Our board-certified attorney, Benjamin Yormak, has helped hundreds of Florida employees navigate complex legal terrain and fight for compensation. Contact us today for a free consultation.

Understanding Misclassification as Exempt

Employers can avoid paying extra hours beyond the standard 40-hour workweek by misclassifying employees as exempt from overtime. The Fair Labor Standards Act (FLSA) determines which employees can be classified as exempt from overtime. Overtime is typically one and a half times the employee’s standard hourly rate for any time that exceeds a 40-hour workweek.

Employers may attempt to circumvent this by giving a specific job title classified as exempt when, in reality, the work makes the employee eligible for overtime pay.

The Fair Labor Standards Act (FLSA)

The Fair Labor Standards Act is a federal law that requires employers to pay covered nonexempt employees at least the federal minimum wage and overtime pay for all hours worked over 40 in a workweek.

However, specific jobs are classified as exempt from these requirements. Therefore, the FLSA establishes job duties based on tasks and responsibilities rather than job titles to avoid misclassification.

Positions Exempt from Overtime Pay

The Fair Labor Standards Act determines four exemptions where employers can avoid paying overtime.

Executive Exemption

Employees whose primary duty is managing a company or a department, who regularly oversee the work of at least two full-time employees, and who can hire or fire other employees are exempt from overtime.

Administrative Exemption

Employees who perform office work directly related to core business operations are exempt. Their tasks often involve making significant decisions that can impact the company’s policies. Involvement in administrative duties is not sufficient to be classified as overtime-exempt. Instead, the job must involve some degree of management of the company’s affairs.

Professional Exemption

This exemption is made up of two categories–learned and creative professionals. The learned professional exemption applies to employees whose primary duties require advanced knowledge from study or training. Examples include professions such as lawyers, architects, engineers, and teachers.

The creative professional exemption applies to employees who bring particular originality, imaginative solutions, or specialized talent to a recognized creative field.

Computer Employee Exemption

Computer systems analysts, software engineers, programmers, and other skilled workers in the computer field may be exempt from overtime if they meet the following specific criteria:

• Their work focuses on designing, developing, documenting, testing, creating, or modifying computer systems or programs related to machine operating systems.
• They are compensated with a salary or fee of at least $684 per week or, if paid hourly, at a rate not less than $27.63 an hour.

Outside Sales Exemption

Salespeople working outside the office are generally exempt from overtime pay requirements, and under some agreements, such as commission-only agreements, may not qualify for federal minimum wage protection under the Fair Labor Standards Act. This exemption applies to workers in the field whose primary job is sales transactions away from the office or job site.

Signs You Have Been Misclassified as an Exempt Employee

Employees paid on a salary basis performing non-exempt duties: Salaried employees aren’t automatically exempt from overtime pay. The FLSA determines that exemption from overtime is not determined solely by the salary status but by the nature of the work performed.

Employees don’t supervise other employees: If a management position doesn’t involve significant leadership responsibilities, such as overseeing the work of others, making strategic decisions, or having the authority to hire, fire, or promote staff, this could mean misclassification.

Their work doesn’t require advanced knowledge: Jobs that primarily involve manual labor and don’t require judgment in a field of science or learning are not exempt from overtime. An exemption is typically reserved for roles requiring specialized knowledge and a high degree of education.

They don’t make sales outside the office: Employees whose role is predominantly office-based, even if it involves sales tasks, do not meet the exempt criteria and could be eligible for overtime pay. The exemption applies specifically to employees who spend significant time away from their employer’s offices, engaging directly with customers or potential clients.

Employees have been mislabeled as independent contractors: Independent contractors have more control over how they complete their work and are not subject to the same rules and regulations as employees. The Department of Labor states that employers cannot label those in an employment relationship as independent contractors to avoid paying standard benefits and protections when an employment relationship exists.

Next Steps If You Have Been Misclassified as Exempt

If you believe you have been misclassified and denied overtime pay, it’s important to follow these steps:

• Keep a record of your weekly work hours, especially those exceeding the standard 40-hour workweek. This documentation can work as evidence in a legal action.
• Seek legal advice. Employment lawsuits can result in significant financial recovery, making it crucial to consult a board-certified employment lawyer to guide you through the process and ensure you receive the compensation you deserve.

Misclassification to avoid paying overtime is a form of wage theft, and at Yormak Employment and Disability Law, we believe you deserve justice.

Contact Us for a Free Consultation

Hiring a Florida employment attorney can make all the difference in unpaid overtime disputes. At Yormak Employment & Disability Law, we work diligently to protect our clients from employment violations and ensure that employers don’t overlook their legal rights. We’ve fought for rightful compensation and damages for hundreds of employees in Florida. You don’t have to face this challenge alone. Contact us for a free consultation.