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Wage Misclassification and Exemptions

Whether intentional or not, misclassifying workers can end up costing them benefits, pay, and overtime wages. Unfortunately, the rules are complicated, leading to confusion for both employers and employees.

Fair Labor Standards Act and Wage Law Misclassification

Misclassification is one of the most common labor law violations that you’ve probably never heard of. “Misclassification” means that your employer classifies you as one thing when you are something else. One version is to classify an employee as an “independent contractor.”

This page is about when an employer misclassifies you as “exempt” from overtime rules. In other words, the employer claims that you are not entitled to overtime pay when, under the law, you are. Overtime misclassification can deprive you of a lot of hard-earned money, so it is important to understand when you have a right to overtime pay.

The general rule is that employers must pay workers “time-and-a-half” for any work hours past 40 in a single week. This means that you have to be paid one-and-a-half times your normal hourly wage if you work overtime.

The law has some exceptions, however. Unfortunately, whether by mistake or on purpose, some employers classify employees as “exempt” when they shouldn’t be. The result? Lost overtime wages.

FLSA Exemptions

There are many exemptions under the Fair Labor Standards Act, including some unusual ones — like wreath-makers! The common exemptions, however, are:

  • Executive Exemption
  • Administrative Exemption
  • Professional Exemption (for Learned and Creative Professionals)
  • Outside Sales Exemption

How do you know whether your job entitles or exempts you from overtime protections? For most exemptions, classification as an employee turns on two factors:

  1. Whether you are paid a salary
  2. What your work duties are.

You must meet both requirements to be exempt from overtime pay requirements.

The good news is that the salary requirement is usually easy to figure out. If you are paid a salary of at least $684.00 per week, and your pay is not subject to any deductions, then you probably meet the salary test. Outside sales is a bit different than the rest.

Important: Just because you are paid a salary does not mean you are automatically not entitled to overtime pay.

The next test is the “duties” test, which looks at what kind of job you have. Job titles don’t factor in. Just because you are called a “manager,” does not mean you are exempt. Each exemption has a separate duties test. Depending on your position, exempt duties might include managing two or more full-time employees or hiring and firing employees.

The best way to figure out if you are exempt is to talk to an employment lawyer who is experienced in wage and hour issues. Section 13(a)(1) of the FLSA outlines the exemptions for minimum wage and overtime pay. If you want to look at the duties yourself, you can find them here.

Do You Have a Claim for Wrongful Misclassification?

It is not always obvious whether you have been misclassified. Your employer may have incorrectly classified you as exempt when you should be earning overtime wages. If so, you may have a legal claim for the unpaid wages.

You can recover against your employer for misclassification in various ways, including recouping lost wages, overtime, and “liquidated damages.” These amounts can really add up, so it is worth calling an attorney who is experienced in unpaid wage issues.

Call Biller & Kimble, LLC to Pursue Your Claim

By asserting your rights as an employee under the FLSA, you can hold your employer accountable and protect yourself at work. But that doesn’t mean you need to fight alone.

Our law firm is skilled at bringing lawsuits for unpaid wages. Misclassification is a complex area of the law, with exemptions that are not always clear-cut. If you have any questions or believe that you have been wrongly misclassified by your employer, the lawyers at Biller & Kimble, LLC can help. Call (513) 202-0710.