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We all know the general rule about overtime:  Employees must be paid at 150% of their standard rate of pay (“time and a half”) for any time worked in excess of 40 hours per week, but certain employees, especially executive or managerial employees, are exempt.  In practice, the line between “exempt” and “nonexempt” employees is sometimes unclear, especially with respect to restaurant and retail employees who hold managerial roles where they exercise some degree of autonomy and supervision over other employees, but still perform some degree of nonexempt work.

The general framework

The Fair Labor Standards Act (the “FLSA”) requires that any employee who is engaged in work for a workweek longer than 40 hours must be compensated “at a rate not less than one and one-half times the regular rate at which he is employed.” However, the FLSA exempts certain categories of employees from this requirement.  Among these categories are employees who are “employed in a bona fide executive, administrative, or professional capacity…”

The Department of Labor (the “DOL”) has promulgated regulations setting forth the criteria that an employee must satisfy in order to be deemed exempt. The title that an employer attaches to a position is not determinative; simply calling an employee a “manager” or “supervisor” will not automatically make the employee exempt from overtime pay requirements.  Rather, “[t]he exempt or nonexempt status of any particular employee must be determined on the basis of whether the employee’s salary and duties meet the requirements of the regulations in this part.”

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