When determining how an employee is to be paid, there are many decisions to be made- including overtime, minimum wage, and salary versus hourly wage. The Fair Labor Standards Act (FLSA) provides the guidelines for making such decisions.

Independent Contractors

Determining whether an individual is an employee or independent contractor is an important one. If an employer incorrectly classifies an employee as a contractor and excludes him/her from benefits, it could have costly consequences. The following link from the Department of Labor provides a checklist of questions to assist employers in distinguishing between the two.

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Exempt versus Non-Exempt Status

Several categories of employees are exempt from being paid overtime under the Fair Labor Standards Act (FLSA) including executives, administrative employees, professionals, computer-related occupations, and outside sales employees. The following link from the Department of Labor provides a fact sheet on each category and an interactive system to assist employers in identifying exempt employees.

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Overtime

Under the FLSA, employees that are classified as non-exempt are entitled to overtime pay at a rate of at least one and one-half times their regular rate of pay for hours worked over 40 in a work week. The following overtime calculator from the DOL provides assistance in determining what is considered hours worked and determining how much to pay employees.

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Overtime regulations also vary by state as many states have enacted more generous overtime provisions for employees. For information on a particular state, please click below for a list of the State Department of Labor websites.

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