In 2004 new overtime regulations were enacted for
salaried employees. The new regulations provide the following:
-
Employees who are paid a salary of less than $455 a week
($23,660 a year) must be paid overtime regardless of their job
duties and responsibilities.
-
Employees who are paid a salary of at least $455 a week are
exempt from overtime pay requirements if they also meet the
following test:
-
The
employee's primary duty is management of the business or a
department or subdivision.
-
The
employee customarily and regularly directs the work of two
(2) or more employees.
-
The
employee has the authority to hire or fire other employees
or his/her suggestions and recommendations as to promotion,
hiring, advancement or any other change of status of
employees is given particular weight.
When determining whether a salaried employee's
"primary duty" is management, the employer must look at the
principal, main, major or most important duty that the employee
performs. If an employee otherwise qualifies for the exemption,
his/her concurrent performance of exempt [managerial] and non-exempt
work does not disqualify him/her from the exemption.
For example, an assistant manager may perform
non-exempt work such as serving customers, cooking food, stocking
shelves and cleaning, but his/her "primary duty" may still be
management. Employees who spend more than 50% of their time
performing exempt [managerial] work generally satisfy the "primary
duty" test. An employee who spends less than 50% of his/her time
performing non-exempt work may qualify for the exemption, but if
he/she is subject to a lot of supervision and his/her pay is little
more than a non-exempt employee's, the likelihood is that he/she
will be deemed non-exempt.
Exempt employees generally have the ability to make
the decisions when to perform nonexempt duties and remain
responsible for the success or failure of business operations under
their management while performing the nonexempt work.
An employee satisfies the test of "customarily and
regularly" directing the work of others if he/she does so normally
and recurrently every workweek and not just occasionally or on
isolated or one-time occasion(s).
Finally, the regulations provide that a chef such as
an executive chef and sous chef, who has attained a four (4) year
specialized academic degree in a culinary arts program, is generally
exempt from overtime under a separate exemption for "learned
professionals." This exemption is not available to cooks who perform
predominantly routine mental, manual, mechanical or physical work. A
chef who has not attained a degree may still be exempt if his/her
primary duty requires invention, imagination, originality or talent,
such as that involved in regularly creating or designing unique
dishes and new items.
What is "Management"?
Generally, management includes, but is not limited
to, activities such as interviewing, selecting and training of
employees; setting and adjusting their rates of pay and hours of
work; directing the work of employees; maintaining production or
sales records for use in supervision or control; appraising
employees' productivity and efficiency for the purpose of
recommending promotions or other changes in status; handling
employee complaints and grievances; disciplining employees; planning
the work; determining the techniques to be used; apportioning the
work among employees; determining the type of materials, supplies,
machinery, equipment or tools to be used or merchandise to be
bought, stocked and sold; controlling the flow and distribution of
materials or merchandise and supplies; providing for the safety and
security of the employees or the property; planning and controlling
the budget; and monitoring and implementing legal compliance
measures
Fair
Labor Standards Act FAQ
