Dallas Employment Lawyer Blog
Over the last month, I have noticed an increase in the number of salaried employees who have become concerned about their paycheck. Some salaried employees have found themselves mandated to reduce their work to less than forty hours per week, and as a result to account for the reduction, their employers have threatened to reduce their pay. Conversely, other salaried employees have found themselves working significantly more than their traditional forty-hour work week as a result of the high COVID demands in their particular industry. However, some companies are not compensating employees for the extra hours worked – can they do that? Well, the answer is, it depends.
Understanding salaried employees’ rights under the Fair Labor Standards Act (FLSA) can sometimes be complicated. It is my hope that after you read this article you would have a better understanding of your rights as a salaried employee.
A salaried employee is someone who receives a predetermined amount constituting part or all of the employee’s compensation. In other words, an employee may be considered a salaried employee if the employer has guaranteed that the employee will be paid a certain amount regardless of the amount of work performed, which is commonly referred to as the “minimum guarantee.” Many salaried employees feel that they have no rights because they are salaried. That is untrue. Salaried employees have many of the same rights as hourly employees. For example, salaried employees may still be entitled to overtime pay.
Speaking of overtime, let’s discuss the general rule of overtime in Texas. The general rule states all employees are to be paid overtime unless (1) the employee makes the minimum salary of $684 per week (or $34,568 annually), which was an increase from $455 per week on January 1, 2020, and (2) the employee performs exempt job duties. The three common job duties exemptions are executive, professional, and administrative. While these exemptions seem to be straightforward when taken face value, they are usually not. Often times, employees meet the minimum salary requirement, but the employee’s job duties may not squarely fit into one of the exemptions.
To determine if a salaried employee is entitled to overtime pay, the question becomes, is the employee exempt or non-exempt? Exempt employees are not entitled to overtime while non-exempt employees are entitled to overtime. Determining exemption status is not always crystal-clear. In fact, there is no answer that fits all. It is important to know that an employee’s exemption status is not solely determined by a job title or how much money one makes. Do not allow your employer to mislead you by stating you are exempt because you hold a certain title or how much money you make. Exemption status is usually determined by several factors.
In our introduction, we discussed salaried employees who have told me how employers have approached hours and pay, as a result of COVID-19 impacts. In the first scenario, generally speaking, if the salaried employee shows up for work and is available for work but there is not enough work, the employee should be paid his or her weekly salary, irrespective to how many hours they worked. That said, employers should not be docking an employee’s pay unless there is a valid reason to do so. In the second scenario, if the salaried employee is working more than the traditional forty-hour work week, he or she may be entitled to overtime, but that depends on the exemption status.
If you are a salaried employee and you are concerned whether your employer is properly paying you, or if you’re simply concerned about your exemption status, you should contact a Dallas Employment Lawyer and schedule a consultation. Remember, salaried employees have rights.