LEGAL MATTERS: Are You Entitled To Overtime? You Might Be

Wednesday, February 06, 2013

John T. Longo, GoLocalWorcester Legal Contributor

Are you entitled to overtime? You may be, and don't realize it. See what your rights are under the law.

Salaried employee? Management? Supervisor? You may still be entitled to overtime pay because federal and state law, not the title your boss gives you, determine who gets overtime and who does not.

The Law

With certain limited exceptions, the federal Fair Labor Standards Act states employees who work more than 40 hours in a week must be paid for those extra hours at a rate not less than time and one-half their regular rate. They have to be paid in money, not with ‘comp time.’ However, if an employer can prove that an employee fits into one of the limited exemptions spelled out in the Act, or similar state laws, that employee is not entitled to overtime. The burden is on the employer to prove the employee is exempt.

The Exceptions

The Act became law in 1938 but certain industries have convinced Congress to exempt them from its various provisions. It is therefore littered with odd-ball exemptions – including one for some auto parts clerks and one for some radio announcers - that makes it impossible to say everyone is entitled to overtime.

The odd-ball exemptions aside, determining who is exempt from the Act’s overtime requirements must be done on a case-by-case basis. (So two people can hold the same title but only one might be exempt.) For employees to be exempt, their employer must generally prove the employees:

1. Earn at least $455 per week.

2. Are paid on a salary basis. That means they get paid the same every week they do any work no matter how many hours they actually put in during that week. Their wages cannot be reduced if they cut out early to go to a doctor’s appointment, or a child’s soccer game, or even if the business is closed because of bad weather. It also means their wages cannot be reduced based on how well they did their job that week.

3. Pass the Duties Test meaning they perform certain executive, administrative, professional, outside sales, or computer professional tasks specified in the Act.

If the employer cannot prove all three things, and the employees earn less than $100,000 per year, the employees are usually entitled to overtime.

The Duties Test

It is almost impossible for blue collar workers to pass the Duties Test. On the other hand, professors, professionally licensed engineers, certified public accountants, doctors and lawyers rarely flunk the exam because they are deemed professionals. Most legal fights involve people who fall between the two extremes into the executive and administrative categories.

To be exempt executives, the employees’ primary duty must be managing a business or department, they must supervise at least two people, and they must have authority over hiring, firing, and promoting people. Most shift managers, assistant managers and supervisors don’t have that kind of authority and they therefore will flunk the Duties Test and be entitled to overtime pay.

To be exempt administrators, the employees cannot be doing manual labor and their primary duty must include exercising “discretion and independent judgment with respect to matters of significance.” That means secretaries and administrative assistants will not pass and they must be paid overtime. Similarly, people who order office supplies and make other minor decisions for the business will not be exempt.

There are reams of regulations and court decisions dealing with the Duties Test so you may need an attorney to help determine whether you are exempt.

Your Rights

As an employee, you can sue and recover double the amount of overtime pay your company cheated you out of in the prior two or three years. On top of that, your company will have to pay your legal fees if you win in court. If you do not want to sue, you can also file a complaint with the Department of Labor but it rarely gets involved in individual cases.

If you own a business and want to make sure you are complying with the law, you can check the Department of Labor’s on-line eLaw Advisor. Then check with your state department of labor because state laws are sometimes stricter than the FLSA.

John Longo is a consumer rights attorney practicing law in Rhode Island and Massachusetts. He represents consumers who have disputes with businesses, employees cheated out of their wages or overtime, car buyers stuck with Lemons, and people in need of bankruptcy protection. He is a member of the National Association of Consumer Advocates, the National Association of Consumer Bankruptcy Attorneys, and the Rhode Island Association for Justice.