In 1938, the working world was forever changed by a piece of legislation called ” The Fair Labor Standards Act”. FLSA for short. If you’ve worked any role in the United States, you’ve been impacted by this nearly 80-year-old law.
Just a few of the ways include:
- 8 Hour Work Days
- 40 Hour Work Weeks
- Minimum Wage
- Overtime Pay
All of these are standard terms just about anyone in the workforce understands and all can be attributed to the FLSA. Two more important terms include — Exempt and Non-Exempt.
The Difference Between Exempt and Non-Exempt
Simply put, employees of an organization that are “exempt” means that those employees are not afforded many (if not all) of the items included in the FLSA. “Non-exempt” employees are those individuals who are covered by the protections in the bill. Examples of exempt employees can typically be summed up as “salaried”, or getting paid a fixed amount other than an hourly wage. Non-exempt workers are usually, but not always, hourly employees.
The FLSA requires employees to work up to 40 hours a week for at least a minimum wage. Then, every hour after this should be paid, at least, one and a half times the hourly amount set.
Can an Hourly Employee Be Exempt?
Perhaps the most common question asked regarding the FLSA is whether or not hourly workers can be exempt. Meaning, can someone be paid a wage by the hour and not be eligible to receive the protections afforded by the bill?
The Fair Labor Act is sweeping and vast, covering most hourly employees in the United States of America. However, there are several positions and industries that are not under these regulations.
Just a few of these industries include:
- Truck Driving
- Movie Theaters
- Stage Work (Theater)
Why Are There Exempt Hourly Employees?
There are actually two broad reasons that exempt hourly employees exist.
Existing Regulation for the Industry
For some industries, such as trucking and railroad, there is already comprehensive legislation that is specific to each industry. These laws often include working conditions and pay rates and do not fall under the FLSA. Often the pay and work standards are specific to the needs of the industry and workers.
Exceptions to the Hourly Exemption
Oddly enough, there are industries specifically excluded from the protections in the FLSA. For instance, the bill excludes hourly movie theater employees from receiving overtime for working more than 40 hours. Even though there is this exemption, other portions of the law are still intact. For instance, child labor laws and minimum wage.
Agriculture hourly employees, similar to movie theater workers, are exempt from receiving mandatory overtime. While this is another industry not covered entirely by the FLSA, it is also similar to theaters in that, it still is under child labor and minimum wage laws.
Perhaps the most well-known exception to the FLSA exemption is the wait staff. Servers at restaurants have a minimum wage, but it is far lower than the national minimum wage.
States Role in Exemptions
In addition to the FLSA being a Federal law, there are many states who have added further restrictions. Many of these state laws can contradict the Federal bill. For example, some states require that wait staff be paid more than the national $2.13 per hour. Hawaii, Alaska, and Minnesota require servers to be paid more than $9 per hour.
Other states negate the hourly exemptions in many cases. Movie theaters in North Carolina are required to pay time and a half for employees who work over 40 hours in a given week.
Finding Specific Exempt and Non-Exempt Laws
Both employers and hopeful employees alike may be interested in finding out the standards required by the law. There are several places to visit in order to become informed about the regulations in your industry and state.
- The Department of Labor (DoL): The U.S. Labor department is one of the most comprehensive looks at federal legislation. There is an entire Wage and Hour Division with its own webpage.
- Your State’s Labor Department: Once you understand the federal obligations, it’s a good idea to see if there are any further regulations required by your state. The DoL has a page devoted to individual state legislation.
- Current Market Standards: Aside from the laws (which you absolutely should understand), it’s also a good idea to look at others in the same industry. If you’re an employer and you want the best talent, you’ll likely have to pay more than minimum wage. If you’re a skilled worker, it’s a good idea to find those paying better, too.