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Exempt or Nonexempt.Employees whose jobs are governed by the FLSA are either "exempt" or "nonexempt." Nonexempt employees are entitled to overtime pay. Exempt employees are not.
Nonexempt: An individual who is not exempt from the overtime provisions of the FLSA and is therefore entitled to overtime pay for all hours worked beyond 40 in a workweek (as well as any state overtime provisions). Nonexempt employees may be paid on a salary, hourly or other basis.
If an employee is classified as exempt under the FLSA, the employee is not covered by the overtime provisions of the FLSA and is paid an agreed amount for the whole job, regardless of the amount of time or effort required to complete the work.
Exempt positions are excluded from minimum wage, overtime regulations, and other rights and protections afforded nonexempt workers. Employers must pay a salary rather than an hourly wage for a position for it to be exempt.
Who is eligible for overtime pay? To qualify as an exempt employee one who does not receive overtime pay staff members must meet all the requirements under the duties and salary basis tests.
An exempt employee is not entitled overtime pay by the Fair Labor Standards Act (FLSA). These salaried employees receive the same amount of pay per pay period, even if they put in overtime hours. A nonexempt employee is eligible to be paid overtime for work in excess of 40 hours per week, per federal guidelines.
The FLSA includes these job categories as exempt: professional, administrative, executive, outside sales, and computer-related. The details vary by state, but if an employee falls in the above categories, is salaried, and earns a minimum of $684 per week or $35,568 annually, then they are considered exempt.
Simply put, an exempt employee is someone exempt from receiving overtime pay. It is a category of employees who do not qualify for minimum wage or overtime pay as guaranteed by Fair Labor Standard Act (FLSA). Exempt employees are paid a salary instead of hourly wages and their work is professional in nature.
Exempt employees refer to workers in the United States who are not entitled to overtime pay. This simply implies that employers of exempt employees are not bound by law to pay them for any extra hours of work. The federal standard for work hours in the United States is 40 hours per workweek.