Classifying Positions as Exempt from Overtime

While the brakes have been put on the Obama Administration’s attempt to raise the salary requirement for exempt executive, administrative, professional, and computer employees from $455 per week ($23,660 per year) to $913 per week ($47,476 per year), that does not mean that employers are in the clear when it comes to classifying positions as exempt.  The DOL is reviewing public comments received in response to a July 2017 Request for Information on this matter.  The agency is expected to propose an increase in the salary threshold required for exemption, and may propose other changes as well. 

Even before any changes take effect, however, employers should periodically evaluate potentially exempt positions to ensure that they meet regulatory requirements.  This evaluation consists of assessing whether the salary threshold is met for each position classified as exempt, as well as ensuring that the position’s duties fall within specific regulatory requirements. 

Misclassification of a position as exempt can prove costly, resulting in back pay and other penalties against employers.  To avoid this kind of negative outcome, HEC has provided members with an updated research report on exemption tests under state and federal law.  Updated job analysis checklists for executive, administrative, professional, outside sales, and computer employees are also available.  Members are encouraged to call or email HEC for assistance with analyzing their exempt positions.

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