What are the most common legal issues involving salaried employees and overtime pay?
You may know that most salaried workers do not receive overtime premiums for working beyond 40 hours a week. There are, however, certain scenarios where employers misclassify their employees as not eligible for overtime pay, which violates the law. If this occurs, the employee and all other employees who perform similar jobs are legally entitled to unpaid overtime and likely additional damages.
Legal Issues Regarding Salaried Employees and Overtime Pay
These are some of the most common legal problems facing salaried employees.
- Job Misclassification
There are several ways this occurs. Employers sometimes attempt to escape overtime requirements by classifying hourly employees as salaried when their work doesn’t fit the definition. This commonly occurs with assistant managers, mortgage loan officers, and entry-level engineers. This is also a problem when employers classify their workers as salespersons or contractors. These two overtime exemptions have strict requirements that employers must fully meet. If not, then these employees are entitled to overtime pay. - Not Earning Enough to Be Exempt from Overtime
Did you know you have to earn a certain amount every week to be exempt from overtime pay? You’re probably aware that hourly employees earn an overtime premium for working beyond 40 hours. An employer must also pay overtime to employees who earn less than $913 a week in salary which equates to $47,476 a year. - Not Receiving a Full Salary
A salary is a set amount that employers pay employees each week no matter how many hours the employees work that week. Employers cannot legally make salary deductions for items such as lack of work, missing work, and other illegal items. Employers who make such deductions have destroyed the employees’ salaries so those employees are entitled to overtime pay. - They’re Salaried Without Working a White Collar Job
The exemption from overtime only applies when a salaried person performs a certain kind of job. These are often called “white collar” positions, which refer to administrative, managerial, professional, and creative work. In other words, salaried employees are likely not exempt from overtime if they do physical labor in a manufacturing plant or other manual labor jobs.
Why Job Misclassification is a Big Problem
If you’re wondering whether you have a case for an unpaid wages lawsuit, it helps to understand the general rules above regarding salary payments and overtime pay eligibility. This is true for salaried and hourly employees alike. Otherwise, you might unknowingly fall victim to an employer who changes your job title from line worker (hourly) to assistant manager (salaried) to pay you less. Employers attempt to pay salaries illegally because they can work salaried employees as many hours as possible each week without paying them overtime pay thus saving the employer’s payroll costs.
Other Concerns for Salaried Employees
We should also mention employment concerns for highly-compensated individuals. Employees who earn at least $107,432 in salary per year more easily qualify for the overtime exemption which means that they are not legally entitled to overtime pay. However, employees who earn over that amount remain entitled to overtime pay in many instances which include: mortgage loan officers, telephone sales representatives, case managers, and assistant managers.
Watch Severance Package Terms & Conditions
We are noticing that more and more employers are offering severance packages to employees who are owed overtime. Employers are hoping that employees will sign the packages and waive their rights to bring a claim for overtime pay. You should contact an employment attorney if you believe you have unpaid overtime and the employer offers you a severance package.
Rowdy Meeks Legal Group LLC Helps Salaries Employees and Overtime Pay Problems
Salaried employee wage claims can be very complex. You may be legally entitled to unpaid overtime whether you earn $1 million a year or $12 per hour. Rowdy Meeks Legal Group LLC represents clients all over the United States to recover unpaid overtime where employers have illegally paid employees a salary. Please contact Rowdy Meeks Legal Group LLC if you are a salaried or hourly employee who believes you have a claim for unpaid overtime.