Am I exempt from overtime?

Many of the individuals we represent in unpaid wage and overtime lawsuits are people who have been classified as exempt from overtime by their employer. Most of the time, these people have been told by their employer that they are not entitled to overtime because they are exempt (legally not entitled to overtime), and the people accepted what their boss told them. But you should never take your employer’s word for it. Just because your boss tells you that you are exempt from overtime does not mean that you are an exempt employee. The law determines if you are exempt- not your employer’s interpretation of the law.

If an employer determines that an employee is exempt from overtime when the employee is actually not exempt, this is known as misclassification. Because so many people are unaware of these exemptions, we felt that we should write a series of posts explaining the main exemptions. Here is what you need to know:

1) What is an exemption?  Under the Fair Labor Standards Act (“FLSA”) and New York Labor Law (“NYLL”) an employer has to pay an employee overtime (1.5 X the regular hourly rate) for any time worked over 40 hours in the workweek. But under the FLSA and NYLL, certain employees are not entitled to overtime- they are exempt from the overtime requirements. This means that if an exempt employee works more than 40 hours in the work week, the employer is not required to pay the employee overtime for those hours.

2) What are the main overtime exemptions? There are many exemptions from the overtime requirements. However, there are six main categories of exemptions that fall under a category known as “white collar” exemptions. These employees are generally office employees in positions of significance. The white collar exemptions are as follows (links are provided to department of labor fact sheets to explain more):

3) What employees are usually not exempt? There are groups of employees that are generally not considered exempt from overtime. These people are as follows:

  • Manual laborers or other “blue collar workers” who perform work with their physical skill and energy;
  • Non-Management employees in production, maintenance, construction and similar occupations such as electricians, carpenters, plumbers, mechanics, etc.;
  • Emergency workers such as police officers, firefighters, medical technicians, etc.
  • Trainees- people who are being trained as management but do not have managerial authority.

4) The salary basis test.The main requirement to be exempt is that you must be paid a salary of at least $455 per week (this doesn’t apply to the outside sales category). If you are working in an exempt category, but paid by the hour, then you are entitled to overtime. Additionally, if you are paid a salary, but your employer deducts certain time from your pay if you miss work, then you may also be entitled to overtime. Under the law, being paid on a “salary basis” means you regularly receive a predetermined amount of pay each pay period on a weekly, or less frequent, basis. You are not paid a salary if your employer reduces or changes your pay based on the quality or quantity of your work. Subject to certain exceptions, exempt employees must receive the full salary for any week in which the employee performs any work, regardless of the number of days or hours worked. Exempt employees do not need to be paid for any workweek in which they perform no work. If the employer makes deductions from an employee’s predetermined salary, i.e., because of the operating requirements of the business, that employee is not paid on a “salary basis.” If the employee is ready, willing and able to work, deductions may not be made for time when work is not available.

To learn more about the salary basis test see here: https://www.dol.gov/whd/overtime/fs17g_salary.pdf
5) How do I know if I am exempt from overtime? The only way to know for sure is to perform an analysis of your working conditions to see if they meet the requirements of the exemption. But many times after performing an analysis, it is still unclear whether people are actually exempt. This is why there are so many lawsuits concerning employee misclassification. You can call El-Hag & Associates, P.C and we will perform a free analysis for you so you do not have to speculate about your status.

6) What if my boss tells me I am exempt when I am not exempt? If your employer misclassifies you and does not pay you overtime, then you are entitled to receive overtime for all overtime hours, liquidated damages (generally), costs of the lawsuit and reasonable attorney fees. In many cases employees are paid less than the minimum wage when you compute their hourly wage rate, and would be entitled to the difference between the minimum wage and the actual rate of pay they received.

  • To compute your overtime rate, you would have to divide your weekly earning by all the hours you worked, and then multiply the result by 1.5 to arrive at your overtime rate of pay. You would be entitled to the overtime premium for each overtime hour worked. For example, if you earned $400 per week and worked 50 hours that week your rate of pay is $8.00 per hour $400/50=$8.00). Your overtime rate is $12.00 ($8.00 x 1.5).  Since you worked 10 hours of overtime (50-40=10), you would be entitled to $4.00 per hours for each overtime hour (10 in this example) for the week- $40. In many cases you would actually be entitled to an additional $40 as a penalty known as liquidated damages. If this happened 50 weeks in the year, you would be entitled to $2,000 for the year.
  • To compute a minimum wage violation, you would have to subtract your hourly rate from the minimum wage. In this example, the New York State Minimum Wage in Westchester County is $10.00 per hour (as of the date of this post). Subtract the $10 an hour minimum wage from the $8.00 you were paid and you will have been underpaid by $2.00 per hour ($10-$8.00= $2.00). Here, you would be entitled to $2.00 per hour for each hour of work, so if you worked 40 hours in the week, you would be entitled to $80 in actual wages owed ($2.00 x 40 hours). Again, you would generally be entitled to receive a penalty of an additional $80- so the total would be $160 for the week. If this happened 50 weeks of the year, you would be entitled to $8,000.

So in the above example, for 1 year of work, an employee is entitled to $10,000 if they won a lawsuit. They were underpaid by an actual $416.66 each month that they worked. What could you do with an additional $416 each month? That would pay for a brand new car lease! Under New York State law, an employee can recover up to 6 years of unpaid wages, so if this happened each year, the employee would be entitled to $60,000.00.

This is why employers play games with misclassification. If they can save $416 a month for 1 employee, a small employer with 10 employees can save $4,160 a month, or $49,920 per year. If they have 100 employees they save $499,200 a year. This is why misclassification is a major problem, and because the law gives wiggle room for an employer to argue that you are exempt, it is worth it for them to take the chance  and misclassify you.

7) How to learn more. In the next post, we will go into the exemptions in more detail so you can better determine if you are classified correctly.

 

To learn more about your rights under the wage and overtime laws, disability law, discrimination laws, or family & medical leave law, visit:

Http://www.Elhaglaw.com. El-Hag & Associates P.C is a Labor Law Firm and Employment Law Firm located in Westchester New York. We are overtime lawyers, discrimination lawyers, employment lawyers and labor lawyers. We fight for the rights of working people and we do not represent business owners. So if you have a problem at work, please give us a call to learn more about your rights in the workplace.

El-Hag & Associates, P.C
777 Westchester Ave, Suite 101, White Plains, New York, 10604
• Http://www.Elhaglaw.com • Jordan@Elhaglaw.com • (914) 218-6190 (office) • (914) 206 -4176 (fax)

** Disclaimer- This blog post is applicable to employees working in NY State.  Some of the information is applicable outside of NY State, but you should check the laws of the state in which you work.  Additionally, this information is not intended as legal advice. If you have legal questions CALL OUR OFFICE. We do not want you to take any action relying on this information without being fully informed. You need to make sure that your circumstances protect you under the law before you act.

Does my employer have to pay me overtime if I am paid a salary?

Does your boss have to pay you overtime if you are paid a salary? It depends, but many times the answer is yes! At least a few times a week, we at El-Hag & Associates, P.C, a Westchester New York labor & employment law firm, receive phone calls from employees who are paid a salary but should be receiving overtime. To make sure you are being paid correctly, here is what you need to know:

Unpaid Wages & Overtime Lawsuits

 Click here if you want a comprehensive overview of wage theft, unpaid wages and unpaid overtime

What is a salary? Salary is when an employer pays an employee a set wage each week regardless of the hours the employee works. For example, if your employer agreed to pay you $750 per week as a salary, you would receive that salary when you worked 30 hours in the week or if you worked 100 hours a week. The amount of weekly pay does not change based on your weekly work hours.

When does my employer have to pay overtime when I receive a salary? Your employer MUST pay you overtime if you do not fall under an exemption from the Federal or New York State overtime laws.  In the legal industry, when an employer pays you a salary, but fails to pay you overtime when you are not exempt, it is called misclassification. This means your employer classified you under an exemption when you should be non-exempt from the overtime laws.

What are the main exemptions from the overtime laws. There are five main exemptions to the overtime law. Because exemptions are a detailed topic, I will only mention them and include links to provide you with additional information, I explain exemptions in other blog posts. The exemptions are as follows:

  1. Executive Exemption–  Learn more here- https://www.dol.gov/whd/overtime/fs17b_executive.pdf
  2. Administrative Exemption– Learn more here- https://www.dol.gov/whd/overtime/fs17d_professional.pdf
  3. Outside Sales Exemption– Learn more here- https://www.dol.gov/whd/overtime/fs17f_outsidesales.pdf
  4. Professional Exemption– Learn more here- https://www.dol.gov/whd/overtime/fs17d_professional.pdf
  5. Independent Contractor– Learn more here- https://www.dol.gov/whd/regs/compliance/whdfs13.htm.

How is overtime computed when I am paid a salary? Overtime is always computed based on your regular hourly rate. So when you are paid a salary, the first thing you must do is compute your regular rate of pay each week you work. To do this, you must divide your weekly pay and other non-exempt income received that week by the hours you worked in that week. Once you have your regular hourly rate, you simply multiply your regular hourly rate by 1.5 to get your overtime rate of pay. For example, if your salary is $750 per week and you work 50 hours that week, your regular rate of pay would be $15 per hour ($750/50). The overtime rate of pay is $22.50 ($15 x 1.5).

How much am I owed if I was paid a salary, but my employer did not pay me overtime? Your employer will owe you the OVERTIME PREMIUM for each overtime hour that you worked but not paid overtime. The overtime premium is the extra money you are entitled to for working over 40 hours in a workweek. You are not entitled to the full 1.5 X your regular hourly for each overtime hour worked. Why? because your employer paid you the regular hourly rate for ALL hours worked by paying you the salary. But your employer did not pay you the overtime premium of .5x your hourly rate.

For example- in the previous example we said that if your worked 50 hours in a week and you were paid a salary of $750, then your regular rate of pay is $15 and your overtime rate is $22.50. But since you were paid $15 for each hour worked, you are only owed the difference between the overtime rate of $22.50 and your regular rate of pay ($22.50-$15). In this example your overtime premium would be $7.50. Since you worked 10 hours of overtime (50 hours – 40 hours), you would be owed $75.00 in actual wages for the week, not including penalties ($7.50 x 10 hours).

What is the lowest salary an employer can pay? There is no minimum salary an employer can pay, only a minimum wage. Currently, the NYS  Minimum Wage in Westchester County is $10 per hour. So if your employer paid you a salary of $360 and you worked 40 hours in the workweek, your employer would have violated the New York State Minimum wage provisions because your employer only paid you $9.00 per hour ($360/40). If your employer pays a salary that falls below the minimum wage, you would be owed the difference between what you were paid and the amount you would have received had you been paid the minimum wage. In this example you would be owed $40 because had you been paid the minimum wage of $10.00 per hour, you would have received $400 that week. And since you were only paid $360, you would be owed the difference between $400 and $360, which is $40.

How do I know if I am misclassified as exempt and should be receiving overtime when I am paid a salary? CALL US!!  take a few minutes and call El-Hag & Associates, P.C, and we will be happy to perform a free pay analysis for you. The only other way is for you to research the overtime exemptions and make a judgement call about your employer’s pay practices. This is one of the most common ways employers steal wages. If you have questions, please do not hesitate to call us.

To learn more about your rights under the wage and overtime laws, disability law, discrimination laws, or family & medical leave law, visit:

Http://www.Elhaglaw.com

El-Hag & Associates, P.C
777 Westchester Ave, Suite 101, White Plains, New York, 10604
• Http://www.Elhaglaw.com • Jordan@Elhaglaw.com • (914) 218-6190 (office) • (914) 206 -4176 (fax)

** Disclaimer- This blog post is applicable to employees working in NY State.  Some of the information is applicable outside of NY State, but you should check the laws of the state in which you work.  Additionally, this information is not intended as legal advice. If you have legal questions CALL OUR OFFICE. We do not want you to take any action relying on this information without being fully informed. You need to make sure that your circumstances protect you under the law before you act.

 

Westchester New York Labor & Employment Attorney- Wage Theft 101 (Part 1 of 2)

Attorney Jordan El-Hag, founder of El-Hag & Associates, P.C, was invited to speak to a class of students at the Westhab/Strive work readiness program in Mount Vernon, New York. The focus of the seminar was to provide the students with an overview of their basic rights in the workplace and how to prevent their employers from committing wage theft. The seminar provides a general overview of your right to be paid properly, how to avoid wage theft, what your entitled to if you are a victim of wage theft, what a labor union is, and how a union can help you make more money and receive better benefits at your job. Part 1 focuses on the three main rights of working people and covers the segment on wage theft.

Westhab & Strive are two great organizations devoted to helping low to moderate income individuals achieve more financial stability in their lives by giving the students and customers the tools they need to secure meaningful employment and housing. Westhab’s customers are generally people living in Yonkers New York, Mount Vernon New York, and New Rochelle New York.  It is unfortunate that their students and customers are the most likely to be victims of wage theft and other workplace violations. They routinely have unpaid wage and unpaid overtime violations and are routinely not paid a living wage or provided workplace benefits.

To learn more about your rights under the wage and overtime laws, disability law, or family & medical leave law, visit:

Http://www.Elhaglaw.com

El-Hag & Associates, P.C
 777 Westchester Ave, Suite 101, White Plains, New York, 10604.

Http://www.Elhaglaw.com • Jordan@Elhaglaw.com • (914) 218-6190 (office) • (914) 206 -4176 (fax)

** Disclaimer- This blog post is applicable to employees working in N.Y State. Some of the information is applicable outside of NY State, but you should check the laws of the state in which you work. Additionally, this information is not intended as legal advice. If you have legal questions CALL OUR OFFICE. We do not want you to take any action relying on this information without being fully informed. You need to make sure that your circumstances protect you under the law before you act.

WESTCHESTER NEW YORK WAGE ATTORNEY- UNPAID WAGES & UNPAID OVERTIME- THE THREE MAIN WAYS THAT EMPLOYERS FAIL TO PAY EMPLOYEES FOR ALL THE TIME THEY WORK.

I. INTRODUCTION– In practice, when an employer fails to pay an employee for all the time he/she works, it’s known as wage shaving. It’s a very simple concept; you do not get paid for all the time you work. There are three primary ways that an employer commits wage shaving. This article explains the three main ways employers shave wages and provides you with a system to make sure you are paid for all the time you work. Continue reading

Unpaid Wages, Unpaid Overtime- Wage Theft In Westchester County New York. How wage theft occurs and what you can do about it

Introduction– El-Hag & Associates, P.C is a law firm that focuses on unpaid wages and unpaid minimum wage in Westchester, New York and the surrounding areas, and unpaid overtime in Westchester New York and the surrounding areas. As an employment lawyer in Westchester New York, I have seen many instances of wage theft. However, many employees weren’t even aware of that their wages were being stolen because they were unaware of their rights. Here is some information to educate you on wage theft so you can make sure you are paid what you are owed: Continue reading