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Exempt Employees

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Definition:

Exempt employees are employees who, because of their positional duties and responsibilities and level of decision making authority, are exempt from the overtime provisions of the Fair Labor Standards Act (FLSA).

Exempt employees are expected, by most organizations, to work whatever hours are necessary to accomplish the goals and deliverables of their exempt position. Thus, exempt employees have more flexibility in their schedules to come and go as necessary to accomplish work than non-exempt or hourly employees.

Exempt employees are most often found in managerial, supervisory, professional, administrative, and functional leadership roles such as marketing or product development.

Much attention has been directed at the appropriate classification of exempt employees since revised overtime rules were signed into effect in August, 2004. While many exempt employees, reclassified as non-exempt employees, gained the ability to earn overtime, others, such as team leaders, lost their overtime pay eligibility as newly exempt employees.

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Also Known As: Salaried Employee
Alternate Spellings: Salary Employee

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