Should exempt employees track their time?
Under the FLSA, exempt employees are not required to track their work hours, but an employer can require them to do so. An employer may want to have exempt employees track hours in order to bill services to clients or, to have a record if an exemption is challenged, resulting in the need to calculate the overtime pay due.
May an employer dock the salary if the exempt employee has already used up their PTO?
Yes, salary may be docked in full-day increments when the absence is due to sickness or disability, and you have PTO, paid sick leave, short-term disability or long-term disability plans that provide salary replacement. You can dock for absences before the employee becomes eligible (e.g., a three-day waiting period, while the employee is using the benefits, and after the employee had used up the benefits).
If a supervisor has two full-time employees reporting to her, but one goes out on an extended leave (e.g., two months), is the supervisor non-exempt just for those two months?
Correct, just for those two months. When the employee comes back from leave, you can reclassify the supervisor back to exempt. The same is true if an employee quits, and it takes some time to rehire. This is why I recommend applying the executive exemption only when there are three full-time direct reports – then, if one employee is on leave or quits, there would be no need to reclassify to non-exempt and back again.
For the learned professional exemption, if an employee has a 4-year science degree (BS in environmental sciences or biology, for example) and they are performing entry-level work as a field scientist, is that enough to be considered exempt or should they have a graduate degree to be sure of exemption?
If the employee is a “trainee”, no, they would not be exempt. However, if the employee is performing work in the professional field for which an advanced degree is required, yes. An employee does not have to wait until their career has advanced to qualify for the learned professional exemption.
If we have IT employees in states without a separate computer exemption, do they have to meet two different tests?
You must pay employee overtime unless the employee is exempt under both the federal FLSA and state law. The nine states that do have a separate exemption for computer employees are Colorado, Connecticut, Hawaii, Maine, Minnesota, Nevada, Pennsylvania, Rhode Island, and Vermont. In these states, the employee will need to meet the requirements for either the executive or the administrative exemption – which is usually similar under both the FLSA and state law, but not always. In practical effect, every employee must always meet two tests – the federal and the state.
ComplianceHR’s Navigator OT application does this all for you automatically. Once you choose the state where an employee works – it applies only the available exemptions under federal and state law, and applies both federal and state tests for that exemption.
Where might we find a list of the 134 types of businesses that “lack a retail concept?”
The list is in the FLSA regulations at 29 CFR 779.317.
Have any of the job duties requirements for exemption changed?
No, the 2019 revisions to the FLSA regulations changed only the salary requirements for the exemptions. DOL made no changes to the duties tests.
Is an exempt employee who moves to part-time hours in the same role but makes less than $684 per week now non-exempt due to failure to meet the salary test?
Yes, there is no pro-rating of the minimum salary level for exemption. On the other hand, a part-time employee should not be working overtime hours, and thus no overtime would be due. If your part-time employees often work overtime, you may have bigger issues if they are not receiving benefits for full-time employees, and you are classifying them as part-time for workers’ compensation purposes.
What corrective measures should employers take when they find a misclassified employee? Do employers have an obligation to pay back wages?
Reclassifying employees to non-exempt is necessary, and the employer should do so as soon as possible after reaching the misclassification conclusion. However, many factors affect whether an employer should pay back wages. How clear, legally, is the misclassification? What is your corporate culture? Have you paid back wages under similar circumstances in the past? Is there another event (e.g., merger, reorganization) to explain the reclassification? If you decide to pay back wages, I recommend doing so through the DOL’s voluntary correction program, called PAID. Through PAID, the DOL will ask you to pay two years of back wages (not the third-year or the double liquidated damages), confirm your back wage calculations, and any employee accepting the back wages waive their FLSA claims. Because PAID does not resolve or waive state law claims, the program is not effective for states such as New York and California, where substantial additional back wages are due. For more information, visit the PAID website.
Can exempt employees work 9 hours each day? Can they work a four-day, 10-hour schedule?
Yes, under the FLSA, you can require exempt and non-exempt employees to work any schedule, unless restricted by state law (e.g., hour restrictions for nurses). For non-exempts, however, you must pay overtime for any hours worked over 40 in a week.