True or False - Salaried Employees Don't Get Overtime?

The answer? True and false. The fact is, whether an employee gets overtime is not determined by whether you pay them on a salaried basis. This is one of the most common misconceptions employers have. And misclassifying employees can result in large amounts of money paid in backpay and taxes, not to mention interest and penalties.

Each employee has two status labels: pay status (hourly or salary) and overtime status (exempt or non-exempt). If you pay a person on an hourly basis, they are always eligible for overtime. If you pay a person on a salary basis, then you have to evaluate job duties to determine if they should receive overtime or not.

Only a person's job duties determine overtime eligibility. And, on top of that, there is a very specific set of criteria that employees have to meet in order to be considered exempt from overtime. The FLSA Home Page has detailed information to help make that determination.

The single most useful tool in determining and justifying overtime status is a written job description. It will also be the first thing that you are asked to produce if an overtime dispute comes up. Your job descriptions should contain the following information:

• Job title
• Supervisory status
• Essential job functions
• Additional job functions
• Pay status
• Overtime status
• Date of last revision

Job descriptions should be reviewed annually. Taking the time to put them together and keep them current is well worth the effort.