The FLSA is legislation created in 1938 to establish minimum wage, overtime pay,
recordkeeping, and child labor standards affecting full-time and part-time workers in the
private sector and in federal, state, and local governments. The primary component of the
FLSA was the creation of "overtime," which requires employers to pay covered employees time
and one half (1½) their regular rate of pay for actual hours worked over 40 in a workweek.

The FLSA was designed to cover all employees, except for those who were specifically
excluded. Positions are designated as either exempt (i.e., not covered under the provisions
of the FLSA) or nonexempt (covered by the provisions of the FLSA).

Nonexempt positions are protected by the minimum wage and overtime pay requirements of the
Fair Labor Standards Act (FLSA) and are eligible for overtime compensation. Exempt positions
are not protected by these requirements and are not eligible for overtime pay.

Employees covered by the FLSA must receive overtime pay for hours worked in excess of 40 in
a workweek of at least one and one-half times their regular rates of pay. The FLSA does not
require overtime pay for work on Saturdays, Sundays, holidays, or regular days of rest. The
FLSA also regulates the conditions associated with child (youth) labor.

The determination of a position as exempt or nonexempt is made by HR based on the position
duties and responsibilities, in accordance with criteria outlined in the FLSA.

Whether a position is exempt or non-exempt does not depend on its title, “status”,
anticipated workload, shift, amount of department/agency budget or number of hours worked.
Positions with the same title or grade may vary in their eligibility for overtime, depending
on the actual duties performed by each position.

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The FLSA requires that most employees in the United States be paid at least the federal
minimum wage for all hours worked and overtime pay at time and one-half the regular rate of
pay for all hours worked over 40 hours in a workweek.

Section 13(a) (1) of the FLSA provides an exemption from both minimum wage and overtime pay
for exempt employees.

To qualify for exemption, employees generally must meet certain tests regarding their job
duties and be paid on a salary basis at not less than $455 per week. Job titles do not
determine exempt status. In order for an exemption to apply, an employee’s specific job
duties and salary must meet all the requirements of the Department’s regulations.
Exemptions are based on the type of position and its duties as well as its salary level.
The FLSA provides five possible exemptions for executive, administrative, professional,
computer, and outside sales employees.

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To qualify for the executive employee exemption, all of the following tests must be met:

• The employee must be compensated on a salary basis (as defined in the regulations)
  at a rate not less than $455 per week;
• The employee’s primary duty must be managing the enterprise, or managing a
  customarily recognized department or subdivision of the enterprise;
• The employee must customarily and regularly direct the work of at least two or more
  other full-time employees or their equivalent; and
• The employee must have the authority to hire or fire other employees, or the
  employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion
  or any other change of status of other employees must be given particular weight.

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To qualify for the administrative employee exemption, all of the following tests must be
met:

• The employee must be compensated on a salary or fee basis (as defined in the
  regulations) at a rate not less than $455 per week;
• The employee’s primary duty must be the performance of office or non-manual work
  directly related to the management or general business operations of the employer or the
  employer’s customers; and
• The employee’s primary duty includes the exercise of discretion and independent
  judgment with respect to matters of significance.

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To qualify for the learned professional employee exemption, all of the following tests must
be met:

• The employee must be compensated on a salary or fee basis (as defined in the
  regulations) at a rate not less than $455 per week;
• The employee’s primary duty must be the performance of work requiring advanced
  knowledge, defined as work which is predominantly intellectual in character and which
  includes work requiring the consistent exercise of discretion and judgment;
• The advanced knowledge must be in a field of science or learning; and
• The advanced knowledge must be customarily acquired by a prolonged course of
  specialized intellectual instruction.
• To qualify for the creative professional employee exemption, all of the following
  tests must be met:
• The employee must be compensated on a salary or fee basis (as defined in the
  regulations) at a rate not less than $455 per week;
• The employee’s primary duty must be the performance of work requiring invention,
  imagination, originality or talent in a recognized field of artistic or creative endeavor.

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To qualify for the computer employee exemption, the following tests must be met:

• The employee must be compensated either on a salary or fee basis (as defined in the
  regulations) at a rate not less than $455 per week or, if compensated on an hourly basis, at
  a rate not less than $27.63 an hour;
• The employee must be employed as a computer systems analyst, computer programmer,
  software engineer or other similarly skilled worker in the computer field performing the
  duties described below;
• The employee’s primary duty must consist of:

1. The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software or system functional specifications;
2. The design, development, documentation, analysis, creation, testing or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications;
3. The design, documentation, testing, creation or modification of computer programs related to machine operating systems; or
4. A combination of the aforementioned duties, the performance of which requires the same level of skills.

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To qualify for the outside sales employee exemption, all of the following tests must be met:

• The employee’s primary duty must be making sales (as defined in the FLSA), or
  obtaining orders or contracts for services or for the use of facilities for which a
  consideration will be paid by the client or customer; and
• The employee must be customarily and regularly engaged away from the employer’s
  place or places of business.

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Highly compensated employees performing office or non-manual work and paid total annual
compensation of $100,000 or more (which must include at least $455 per week paid on a salary
or fee basis) are exempt from the FLSA if they customarily and regularly perform at least
one of the duties of an exempt executive, administrative or professional employee identified
in the standard tests for exemption.

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The exemptions provided by FLSA Section 13(a) (1) apply only to “white collar” employees who
meet the salary and duties tests set forth in the Part 541 regulations. The exemptions do
not apply to manual laborers or other “blue collar” workers who perform work involving
repetitive operations with their hands, physical skill and energy.

FLSA-covered, non-management employees in production, maintenance, construction and similar
occupations such as carpenters, electricians, mechanics, plumbers, iron workers, craftsmen,
operating engineers, longshoremen, construction workers and laborers are entitled to minimum
wage and overtime premium pay under the FLSA, and are not exempt under the Part 541
regulations no matter how highly paid they might be.

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The exemptions also do not apply to police officers, detectives, deputy sheriffs, state
troopers, highway patrol officers, investigators, inspectors, correctional officers, parole
or probation officers, park rangers, fire fighters, paramedics, emergency medical
technicians, ambulance personnel, rescue workers, hazardous materials workers and similar
employees, regardless of rank or pay level, who perform work such as preventing, controlling
or extinguishing fires of any type; rescuing fire, crime or accident victims; preventing or
detecting crimes; conducting investigations or inspections for violations of law; performing
surveillance; pursuing, restraining and apprehending suspects; detaining or supervising
suspected and convicted criminals, including those on probation or parole; interviewing
witnesses; interrogating and fingerprinting suspects; preparing investigative reports; or
other similar work.

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The FLSA provides state and local government employees with the ability to earn and take
compensatory time in lieu of overtime. Compensatory time is earned at the rate of one and
one-half hours for each hour of employment for which overtime compensation is earned.
There is a limit on the amount of compensatory time that can be earned. There is a 240-hour
limit, which represents not more than 160 hours of actual overtime worked.

The granting of compensatory time in lieu of overtime pay cannot be required of an employee.
Agreements or understandings may provide that compensatory time off in lieu of overtime
payment in cash may be restricted to certain hours of work only. In addition, agreements or
understandings may provide for any combination of compensatory time off and overtime payment
in cash (e.g., one hour compensatory time credit plus one-half the employee's regular hourly
rate of pay in cash for each hour of overtime worked) so long as the premium pay principle
of at least ``time and one-half'' is maintained.

Employees who have earned compensatory time and request its use are permitted to use time
off within a “reasonable period'' after making the request, if such use does not “unduly
disrupt” the operations of the employee’s department or agency.

An employee has the right to use compensatory time earned and must not be coerced to accept
more compensatory time than the County can realistically and in good faith expect to be able
to grant within a reasonable period of his or her making a request for use of such time.
A request for compensatory time off will be honored unless to do so would be ``unduly
disruptive'' to the agency or department’s operations.

The FLSA does not prohibit an employer from freely substituting cash, in whole or part, for
compensatory time off. Overtime payment in cash would not affect subsequent granting of
compensatory time off in future workweeks or work periods. In a workweek or work period
during which an employee works hours which are overtime hours under FLSA and for which cash
overtime payment will be made, and the employee also takes compensatory time off, the
payment for such time off may be excluded from the computation of overtime.

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The FLSA provides minimum standards that may be exceeded, but cannot be waived or reduced.
Employers must comply, for example, with any Federal, State or municipal laws, regulations
or ordinances establishing a higher minimum wage or lower maximum workweek than those
established under the FLSA.

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For more information regarding the FLSA, visit the Wage and Hour Division’s Web site at
www.wagehour.dol.gov or call the toll-free help line, available from 8 a.m. to 5 p.m. CST,
at 1-866-4US-WAGE (1-866-487-9243).

To locate the nearest Wage and Hour Division office, telephone the toll-free help line or
visit the Department of Labor’s web site for a complete listing of offices.

When the state laws differ from the federal FLSA, an employer must comply with the standard
most protective to employees. Links to state labor departments can be found at
www.dol.gov/esa/contacts/state_of.htm.

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Please contact Classification/Compensation at 715-1400 or e-mail HRD-Classification&Compensation@jocogov.org with questions regarding this
information. Brian Collins is available to answer your questions.

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