Answering the question that this article’s title posits could be what saves you from an investigation from the United States Department of Labor (DOL). Worker misclassification and failure to properly pay employees has recently resulted in employers being forced to pay tens of thousands of dollars in back wages. For this reason, the Chattanooga contractor attorneys at Cotney Construction Law will be discussing what differentiates exempt and nonexempt employees in this brief article.
The Fair Labor Standards Act
The Fair Labor Standards Act (FLSA) stipulates that the majority of workers in the U.S. are entitled to minimum wage and overtime pay for all hours worked over a 40-hour workweek. Overtime work is one and one half times an employee’s base pay. However, there are certain employees that are exempt from this. If you wish to eliminate any lingering doubt when classifying your employees, please consult with a Chattanooga contractor attorney.
Blue Collar Workers Are Nonexempt
Your “blue collar” workers are nonexempt employees. They are covered by the FLSA simply because they perform manual labor. This means employees with jobs “involving repetitive operations with their hands, physical skill, and energy” must be paid at least minimum wage and overtime pay. Construction workers are included in the list of employees that are covered by the FLSA. Also included are carpenters, electricians, craftsmen, and so on.
White Collar Workers Are Exempt
Employees that are exempt from minimum wage and overtime pay are “white collar” workers, specifically executive, administrative, professional, outside sales, and certain computer employees. This is where things get more complicated. To qualify for these exemptions, employees need to meet an assortment of conditions, such as a salary no less than $455 per week.
Please be advised, a salaried employee is not automatically exempt, and exempt status needs to be determined by the employment relationship. There is no one-size-fits-all approach to determining employment relationship. An employee that seems to perfectly fit the white collar role might not hold up during a DOL hearing.
With so many workers coming and going on a jobsite, it’s just not worth it to make assumptions when the consequences of worker misclassification could involve being forced to pay over one hundred thousand dollars in unpaid overtime. Make DOL compliance a priority and partner with the Chattanooga contractor attorneys at Cotney Construction Law to ensure that you are compliant with federal wage and overtime laws.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.