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Human Resources/Exempt Salaried Empolyees and overtime

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Question
I guess you can say I'm the office manager for a small company - 3 employees - in California.  It's an interior design firm and we all assist the main designer doing, i.e. research, getting quotes, etc.  Also, we have our own duties such as I do all the bookkeeping, office stuff and the other people may due project managing, etc.  So we figure we work as "exempt" employees.  However, right now we are operating under the notion if we work more the 8 hours a day, we get overtime but if we work less, we get docked pay.  If that is not "legal", then can say to the employees, if you miss an hour or so, please make up that time in the same pay period?  If you work more than 8 hours, you can use that over time towards leaving early one day or something like that?

Answer
Carla,

Thank you for your question.    In your example,  you are taking pieces of both exempt and non-exempt regs and mashing them together in a creative-- yet non-compliant way.  You are likely way out of compliance in regard to overtime...

You mentioned you and the other employees "..figure we work as exempt employees".   It is not up to the employees to make this decision.   The employer must look at the FLSA, then the duties you  and the other employees are responsible for and then decide if is within the FLSA statutes to make you exempt from overtime.   I'll bet $ 5 bucks you are all due overtime..... and if investigated by the Dept of Industrial Relations  would go back 2 years.   You really need  more help in this regard from a company like mine or a local California firm who can help.  Of course, the local Department of Ind. relations would be glad to poke around to help you resolve this, but might be better not to call the fox into your henhouse.  Get help with an overtime audit and written recommendations by a company on how they will address this for you and get you on track and back to business with no worries on this issue.   Not only do you need to change this approach to paying overtime and tracking hours NOW,  but will need to go back  2 years to "fix" what was done wrong for so long.   Two years is the time an investigator would go back as this is the federal statute of limitations on ot issues as I understand it.    Just so you know,  this issue is not uncommon for small employers either-- they are often not aware of things gone wrong.

You see, if the duties and responsibilities you perform under the FLSA determine you are NOT  exempt-- meaning you get overtime, then you must either be paid a salary-  PLUS overtime half-time #not 1 1/2,  but just 1/2 time...#  or be paid by the hour for work you really work, and then get overtime for anything over 8 hours per day or 40 in a week.  No goofing around with sliding missed hours here and there or sliding overtime from one week to another.  OT is paid in the week it is worked.  If this is being done, it is also a violation.

Here is a resource for you ( or to pass on to your business owner/ boss )that will save me time typing and provide you some insight into what is required in California-- most likely the state with the MOST  compliance requirements overall  !!   Lucky you !

Here is information on California's  overtime and how this is paid to salary and non-salary employees-   YES,  OT can be due to an employee who gets a salary..  And by the way, a salary MAY NOT  be adjusted  to a lower amount to account for less work or quality of work.   a salary is paid the same amount each cycle- hence the definition of salary.    OT can be paid in addition to salary.       Only a few exceptions occur-- and you dont meet those...
    
http://www.dir.ca.gov/dlse/FAQ_Overtime.htm

Next is whether you are exempt or not.  This duties and pay test must be done for each employee...     The ones 17-B  and 17-C  would apply most to your situation.

http://www.dol.gov/whd/regs/compliance/fairpay/fact_exemption.htm


Check out these sites for more information and if I can help more, just reply and please start a  new question thread rather than reply to this one.    Please also rate my response.  

Sincerely,

Brian

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Brian Phillips

Expertise

Foreign and US university students -*PLEASE*- DO NOT waste your time asking for my opinions, comments or analysis of your homework questions. Homework questions are not answered and are rejected. I am happy to help answer questions asked by employees and employers regarding United States based state and Federal wage and hour, OT, Fair labor standards, FMLA, COBRA, Recruiting, Interviewing techniques, employee manuals, discipline, terminations/quits, unemployment, HRIS rollout, Employee Leasing or Staffing company cost analysis, day to day scenarios, work situations and more. Essentially a well rounded HR generalist who operates Harvis, Inc., a human resource consulting and service business based in Northeastern Pennsylvania "NEPA". http://www.harvis.org

Experience

At Harvis, Inc., we provide Human Resource products, services and advice to small businesses that may not have the time or resources to hire a full time HR department. For larger companies with HR managers in place, we compliment their expertise to help with time consuming or time sensitive projects like updating policy manuals, screening and interviewing and more. We make workplaces better by becoming that 1/2 person they need to help handle HR responsibilities on a daily, weekly or monthly basis. Formerly responsible for all Human Resource activity for a staffing agency with 2,500 annual employees as well as an employee leasing / PEO business with 1,500 annual employees. Designed and implemented the HR structure to support hundreds of clients in excess of $ 500 million in payroll volume over career in Human Resources.

Organizations
* President 2006- Harvis Inc. HR Services * President 2010-13 Business Association of the Greater Shickshinny Area - Shickshinny PA * President 2013- ShickshinnyForward Not for Profit Community Long Term Revitalization Organization and former member of varios Chambers of Commerce and HR Taskforce, former President of NBC Business Club 2 years

Education/Credentials
Bloomsburg University - 1993 BS Marketing, Bloomsburg Pennsylvania and Luzerne County Community College - 1991 Business Administration, Nanticoke Pennsylvania

Awards and Honors
* Better than average - 20/10 vision * Bestowed with an occasional "Thank You" from clients and their employees.

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