Salaried Employees

Employees are considered to be "salaried" if they receive a guaranteed minimum amount of money that they can count on receiving each week from their employer regardless of the number of hours worked. Whether or not an employee is considered "salaried" does not depend on whether their compensation is defined in yearly terms. Employees that receive an hourly wage may still be salaried if they can count on a guaranteed minimum amount each week. The Fair Labor Standards Act, which guarantees employees a minimum wage and access to extra pay for overtime, protects salaried employees as well as employees who receive an hourly wage.

Some employers will tell their employees that they are not eligible for wage and hour protections (such as overtime) because they are paid a salary. Others simply refuse to provide overtime pay, or misclassify workers as independent contractors to avoid wage and hour laws. Contrary to popular opinion, however, employees who receive a salary are still entitled to minimum wage and overtime. There are only narrow exemptions. In Texas, all workers must receive overtime pay unless they make a minimum weekly salary of $684 per week ($35,568/year), and perform job duties that make them part of a legally recognized exemption category. Employers must prove that their employees fall into one of these categories in order to avoid paying them overtime. Exemptions based on profession include workers covered by federal labor laws other than the FLSA, as well as outside salespeople, movie theater employees, and some types of agriculture workers.

There are three general exemptions to overtime pay laws that are based on an employee's duties. These fall into three categories: executive, administrative, and professional. Executive employees are considered to be exempt if they supervise two or more employees. They also must manage as a regular duty of their job and have genuine input into or control over other employees' job status. Employees are not considered "executive" if they supervise as a one-off or if they supervise independent contractors or temporary workers. Only regular supervision of other employees is considered sufficient. Examples of management duties accepted by the FLSA include determining work practices, selecting and training employees, setting pay rates, and maintaining business records.

Administrative employees' job duties must include office and non-manual work that directly involves managing an employer's business operations (or its customers' business operations) and requires using independent discretion about important matters. Low-level clerical workers such as administrative assistants are not considered to be administrative employees, since they do not make high-level decisions about business matters using their own discretion. The administrative employee exemption is intended to cover high-level employees who play an instrumental role in keeping the business going.

Finally, the professional employee exemption includes workers who work in "learned professions." In general, lawyers, architects, the clergy, medical professionals, dentists, pharmacists, accountants, and teachers, among others, are considered to be learned professionals. The primary criteria are that the work performed by a professional employee must involve judgment and discretion, require specialized knowledge, and be mostly intellectual. The requirements for this exemption are strict, and it is necessary to closely examine what employees actually do in order to determine whether they qualify.

Unless you fall into one of the narrowly defined exemptions, your employer is obligated to pay you for overtime hours worked. If they incorrectly compensate you, you are entitled to bring a claim under the Fair Labor Standards Act. Generally, you have two years to file suit, but that time limit changes to three years if your lack of overtime pay is a result of a willful violation. Because of this, and because employment laws can be confusing, it is important that you contact an attorney as soon as possible if you believe your employer has violated laws around overtime pay. The Austin employment lawyers at Wiley Walsh, P.C. can help you make a claim to recover your lost income. If you believe your employer is not complying with fair labor practices, or believe you have a claim, you can contact us by filling out our intake form or calling our office at (512) 271-5527.