FLSA misclassification can impact high-salary employees

Workers in Tennessee could be missing out on significant income that they are owed if they are not receiving appropriate overtime, even if they already earn a high wage. One December 2017 U.S. Circuit Court ruling overturned a lower court to hold that two welding inspectors, each of whom earned over $100,000 each year, could be entitled to overtime pay under the provisions of the Fair Labor Standards Act.

The Fair Labor Standards Act requires payment of overtime for employees who work more than 40 hours in one week. This is the case for all non-exempt employees, for which the provisions of the FLSA apply. Other employees can be considered "exempt" under the FLSA, which means that they do not have to receive overtime if they work in an executive, administrative or professional capacity. Thus, many office workers do not receive overtime due to the nature of their jobs. Misclassification of employees as exempt is a frequent subject of concern, as it can be used to avoid paying significant amounts of overtime.

While a worker must make at least $455 weekly to be classified as exempt, exemption requires not only a certain rate of pay and a salaried pay basis but also the exercise of certain types of duties. Even highly skilled and expensive manual labor performed under the direction of others is frequently non-exempt. A lower court dismissed the welding inspectors' lawsuit on the basis of their pay rate and salary style, but a deeper look into the duties of their work is necessary.

Many workers who are making much smaller annual salaries also struggle with issues around their classification as exempt and the denial of overtime that results. This can especially be true for certain types of office workers who lack the authorization to run their jobs independently yet are denied overtime on the basis of their classification. An employment lawyer may be able to help people dealing with potential misclassification under the FLSA to understand their rights and potentially seek compensation for unpaid overtime.

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