Dustin Paschal here with Simon Paschal PLLC for our video tip of the week. It’s been a little while, but we’re back talking about something that we talked about once before. If you remember one of our previous videos was about the white collar overtime exemptions, the executive, administrative, and professional exemptions under the FLSA. And I’m sure you’ve all seen the new regulations that are coming out, or that have come out, that go into effect December 1st, that raised the salary and the salary test portion of those exemptions from 455 a week to 913 a week with automatic increases every three years. And I don’t really want to focus on that today, because you can find that in a multitude of places including our blog and our newsletter. But the other aspect of those exemptions, the other test factor is the duties test. And specifically, the test requires that for those exemptions, the administrative, professional and executive exemption, the primary duty performed by the employee must be the performance of exempt work.
And so I want to talk to you a little bit about what primary duty means. And so the regulations define primary duty as just what you’d think: the principal, the main, the major or the most important duty that the employee performs. It doesn’t mean that the exempt employee is not permitted to perform non-exempt work. They can, it’s just that the primary duty must be exempt work. And so the courts look at all the facts involving the employee’s job. If you look at the job description and see all the different responsibilities that an employee has, and they put an emphasis on the character of the employee’s job as a whole. And so is the employee’s job as a whole something that’s exempt, then that’s their primary duty is exempt work. And what the courts look at, and what the department of labor looks at, and what you should look at when you’re examining an employee’s job description to determine if they are exempt or non-exempt is four different factors.
And the first is the relative importance of the exempt work compared to the non-exempt work. Is the exempt work much more important? If so, more likely to be exempt. Another factor is the amount of time that the employee spends performing exempt work. At least under federal law, there is no floor for the amount of time that an employee must be performing exempt work. You can be performing very little exempt work if it’s the primary duty. Now that said, if at least 50% of the employee’s time is spent performing exempt work, they’re generally going to be exempt, but there’s no floor. So, if it’s under 50% they may still be exempt. An example there is an assistant manager at a retail establishment. Generally, those assistant managers will work the cash register, and they’ll spend a good amount of time working the cash register, but they’re also supervising employees, issuing discipline, creating schedules, and the types of things that would be exempt work, and so they are exempt.
So that’s kind of an example of the time piece there. The third factor that you look at is the relative freedom of the employee from direct supervision. The more free the employee is from direct supervision, meaning they can perform their work with some discretion. That’s going to be more likely an exempt employee. And the final factor to look at is the relationship of the salary that the exempt employee is making, or the person you want to be exempt, compared to the wages paid other employees for doing the non-exempt work that the exempt employee is doing. So those, those non-exempt pieces that the exempt employee is working, how does that employee salary compared to the wages of other employees who are just doing that non-exempt work? And if it’s about the same, you may have a problem saying that the employee is exempt, so they need to be earning some additional income for the exempt work that they’re performing.
So those are the four factors that you want to look at when you’re determining if an employee is exempt under the white collar exemptions. And that’s for the primary duty test. So you always want to have good, well-written job descriptions and look at those to determine your exemptions. So stick with us, we’re going to keep posting videos and we’ll see what the next one is. Thanks!