There are three types of white collar FLSA exemptions:
- Primary duties must involve managing the business or department
- Must supervise two or more full-time employees
- Must have the authority to hire and terminate employees
- Primary duties must be non-manual and directly pertain to the management or business operations of the company
- Must regularly exercise judgment and discretion in matters of importance
- Primary duties must be work of a largely intellectual kind and require the regular exercise of discretion and judgement in matters of importance
- Must work in one of the sciences or other field of learning (architecture, medicine, engineering, teaching, law, accounting, science, or similar field)
- Knowledge of the job must have been gained through a prolonged course of intellectual study (a specialized or advanced degree)
High level managerial employees often meet the criteria for the executive exemption while many registered nurses, engineers, pharmacists, and physician’s assistants qualify for the professional exemption. The administrative exemption is perhaps the most difficult to categorize correctly and is commonly misapplied to employees who do not meet the duties requirement.
It is important for employers to consider more than just an employee’s title when classifying them as exempt or non-exempt. If the employee’s status is in question, then the guidance of qualified legal counsel is imperative to avoid costly mistakes, especially if there are several employees in the same position.
A worker in one of these categories must satisfy both salary and duty requirements to be exempt from the FLSA overtime rules. Titles, such as manager, or salary do not make an employee automatically exempt. The employee must be paid on a salary basis at a minimum of $455 per week. Any employee paid on an hourly basis or commission only system does not satisfy the salary requirement for white collar exemptions.