HR Mavericks

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FLSA Non-Exempt

The Fair Labor Standards Act (FLSA) divides jobs into two very different buckets: those that are exempt from FLSA regulations, and those that aren’t. To keep your business complaint, it’s important to understand the difference between the two.

What Does It Mean to Be FLSA Non-Exempt?

The Fair Labor Standards Act (FLSA) is the federal mandate for how to pay employees, as well as how to classify them as to whether they are exempt or not exempt from overtime—in other words, whether they must be paid for overtime hours or not. You would do well to consult your state regulations, as many do have additional regulations that expand on the FLSA. A non-exempt employee simply means that s/he is not exempt (or not excused) from overtime pay. In other words, they are paid an hourly wage for all hours they work, and there are very clear guidelines as to how they are to be paid. If an employee is not classified as non-exempt, they are exempt from overtime pay. An exempt employee gets a salary: they are paid the same regardless of how many hours they work, and there are many guidelines for how they are paid, too. For the rest of this article, however, we will focus on non-exempt employees: how to classify a position as exempt or non-exempt, and the rights non-exempt employees have under the law.

What Rights Do Non-Exempt Employees Have Under FLSA?

The FLSA guarantees rights across four major areas for non-exempt employees:

Minimum Wage

The FLSA provides a minimum wage rate that changes from time to time. As of 2008, it was $7.25/hour. Individual states also have minimum wage rates. If a state's minimum wage is more than the FLSA's, employers must pay the state minimum wage.


Covered non-exempt employees must receive overtime pay for hours worked over 40 in a workweek. It must be paid at a rate not less than one and one-half times the regular rate of pay. There’s no limit on the number of hours adult employees (over 16 years of age) may work in any workweek. Also, the FLSA does not require overtime be paid on days off or holidays, unless the employee works those days.

Hours Worked

The FLSA defines hours worked as all the time an employee is required to be on the employer’s premises, on duty, or at a prescribed workplace. This means that this time must be paid and considered for overtime eligibility if applicable. Check out our article on compensable time to understand better what kinds of hours are considered “hours worked”.

Child Labor Provisions

The FLSA also protects minors (under age 16) in the workplace, such as amusement parks, public swimming pools as lifeguards, and other employment where minors may be employed.

How to Determine FLSA Status

So how do you classify the positions in your organization as exempt or non-exempt? Exemption from overtime requires some very exacting and clear actions to determine if an employee can qualify as exempt from overtime or non-exempt. There are three tests you put a position or job through to determine if it is exempt or non-exempt.

1. Use the Salary Level Test

This test must be done to determine if the job or position meets the minimum salary levels as described in the FLSA regulations. As of January 2020, the minimum salary level a job or position pays must be at or more than $684 per week, or $35,568 per year.

2. Use the Salary Basis Test

A salary basis simply means that an employee classified as exempt must receive some amount of guaranteed pay per week. In other words, their pay will not change regardless of the number of hours they work, whether they work 15 hours in a week or 80. If an employee is paid a salary, they must be classified as exempt. There are some exceptions to this rule, and the FLSA goes into it in more detail.

3. Use the Duties Test

An employee may also be determined as non-exempt if their specific role or “duties” indicate that that is the case. There are seven classes of potentially exempt employees:
  • Executive employees
  • Administrative employees
  • Learned professionals
  • Creative professionals
  • Computer employees
  • Outside sales employees
  • Highly compensated employees
Keep in mind that any employee can be considered non-exempt—even those who may qualify for any of the categories above. It’s never against regulations to classify employees as non-exempt, regardless of their job duties. However, it may be more advantageous from an efficiency or financial standpoint for an organization to go through the steps of exempt classification.

Examples of FLSA Non-Exempt Employees

It can be hard to understand how to classify employees in theory. Here are a few concrete examples you can learn from:

Situation 1: Amelia the Inspector

Amelia is a city building inspector who earns $72,000 annually. She reports to the building commissioner and has one direct report, an administrative assistant. Her main responsibility is to survey commercial properties and determine if they are sanitary and structurally stable. Amelia does need to apply some professional judgment; her work is highly regulated and she must stay within very prescribed codes and guidelines. She should probably be non-exempt.

Situation 2: Vincent the Help Desk Specialist

Vincent works on the help desk and earns a salary of $65,000 annually. He installs and troubleshoots company software, oversees the phone system, and is in charge of data security. Since Vincent is not a systems analyst, programmer, or systems engineer, and only manages the software and existing hardware, he is non-exempt.

Situation 3: Lacy the Sales Person

Lacy works as a sales person in a boutique. In addition to straightening and tidying up the store and checking in inventory, she is required to approach customers and encourage sales, not just assist with finding products. As the bulk of her work focuses on tasks that are repetitive and supervised, she is classified as non-exempt. Her sales work is not the bulk of her job, and it doesn’t consistently increase her pay via commission or bonus to allow her to meet the salary tests for exemption.


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