What is the Fair Labor Standards Act (FLSA)?
What does the term non-exempt mean?
What does the term “exempt” mean?
What are the criteria that enable employees to be exempt from the FLSA overtime provisions?
What is the salary level test?
What duties tests are applicable to UA employees?
How is the duties test applied?
What constitutes time worked under the FLSA?
Who is responsible for knowing when work is performed?
Is lunch time or dinner time “work time” or “rest time”?
Is a non-exempt employee paid for time to travel between one work location and another work location?
What is the definition of overtime?
Must overtime be approved in advance?
What is compensatory or “comp” time?
One of my non-exempt employees has earned compensatory time off, now that the employee is becoming exempt, can s/he retain the compensatory time balance?
May a non-exempt employee volunteer to work unpaid hours in his/her regular job in addition to his/her regular schedule?
May an employee volunteer hours outside his/her department at The University of Alabama?
Can the supervisor make a non-exempt employee leave early on Friday so the employee’s total hours will not exceed 40 in the workweek?
Can exempt employees maintain separate overtime records and receive overtime?
Who must complete a time record?
Who is responsible for knowing when work is performed?
How much will I pay to participate in an approved tobacco cessation program?
A) The Fair Labor Standards Act (FLSA) is a federal law that ensures employees are treated fairly and are accurately compensated for their time worked. It is enforced by the US Department of Labor. The FLSA distinguishes work as non-exempt and exempt and establishes standards for minimum wage, overtime pay, recordkeeping, and child labor. The University administers compensation in compliance with the FLSA.
Q) What does the term “non-exempt” mean?
A) Non-exempt employees are covered by the overtime and recordkeeping provisions of the FLSA and are entitled to overtime pay if work exceeds 40 hours in one workweek. Overtime is paid at a premium of time and one-half of the employee’s regular hourly rate and pay either in pay or in accrual of compensatory time. Human Resources is responsible for determining the exemption status for positions at UA.
Q) What does the term “exempt” mean?
A) Exempt employees are not covered by the overtime provisions of the FLSA and are paid an agreed upon amount for the whole job, regardless of the amount of time or effort required to complete the work. Exempt employees receive a set monthly salary regardless of the number of hours worked. Exempt employees do not record hours of work.
A) To be exempt, an employee must meet ALL of the standards in the following “tests”:
- be paid over a minimum salary established by the FLSA – the “salary level test” – AND
- be paid on a salary basis as opposed to an hourly basis – the “salary basis test” – AND
- perform certain duties as outlined in one of the “duties tests.”
Q) What is the salary level test?
A)The FLSA salary level test requires that an employee’s salary must be at least $23,660 annually or $455 a week in order to be considered exempt from the overtime provisions. An employee with a salary less than $23,660 annually or $455 a week must be classified as non-exempt. Salary alone does not determine exemption status but is one of three standards that must be met for a position to be considered exempt.
Q) What duties tests are applicable to UA employees?
A) To be exempt, an employee must qualify under one or more of the following tests:
- Executive exemption test
- Administrative exemption test
- Professional exemption test
- Computer exemption test
- Highly compensated employee exemption test
Each duties test has specific requirements that must be met for an employee to be exempt. For example, the Executive Exemption requires that an employee a) supervise two or more full time employees (or their FTE equivalent), b) have authority to hire and fire, or meaningfully recommend hiring and firing, and c) manage a recognized department or subdivision. More information on the exemption tests is available on the Department of Labor website at http://www.dol.gov/whd/overtime/fs17a_overview.pdf.
A) Human Resources is responsible for determining which of the FLSA exemptions would be appropriate for all staff jobs employed by the University. This determination is based on an assessment of the job as described/performed compared with the criteria for each exemption test.
Q) What constitutes time worked under the FLSA?
A) Time worked under the FLSA includes all time spent performing job-related activities that (a) genuinely benefit the employer, (b) which the employer “knows or has reason to believe” are being performed by an employee, and (c) which the employer does not prohibit the employee from performing. These can include activities performed during “off-the-clock” time, at the job site or elsewhere, whether “voluntary” or not.
Examples of work time include a) time worked before the scheduled start time; b) rest breaks less than 20 minutes; c) eating lunch at the desk, while answering the phone, serving clients, or performing any work; and c) time worked after the scheduled ending time.
Examples of non-work time include a) eating lunch at desk, but not answering phone nor working, and b) rest breaks or meal periods of 20 minutes or longer.
Q) Who is responsible for knowing when work is performed?
A) The employee’s supervisor is responsible for monitoring when work is performed. Overtime should be pre-approved by the supervisor and recorded on the time record. The supervisor is responsible for verifying and approving time records. All hours worked must be paid even in instances where pre-approval has not been granted.
Q) Is lunch time or dinner time “work time” or “rest time”?
A) Bona fide meal time is not work time. The meal period generally should be at least 30 minutes. The employee must be completely relieved of all duties, and the employee must be free to leave the duty post.
Q) Is a non-exempt employee paid for time to travel between one work location and another work location?
A) Travel from one work site to another during the workday is work time. Special rules exist for out-of-town overnight travel. For specific details, please contact Human Resources.
A) Overtime is time worked by a non-exempt employee that exceeds 40 hours in one workweek.
Q) Must overtime be approved in advance?
A) In support of the supervisor’s continued awareness of unit work volume, individual productivity, and available funds to pay overtime compensation, the supervisor must provide prior approval for a non-exempt employee to work overtime.
Q) What is compensatory or “comp” time?
A) Under the FLSA, comp time is paid time off from the job that is earned and accrued by an employee in lieu of cash payment for work performed in excess of their regular weekly schedule. The FLSA requires that comp time be earned at a rate of one-and-one half hours for each hour worked over 40 in one workweek. Accrual of comp time in lieu of pay must be agreed upon by the employee and supervisor prior to the work being performed.
Q) One of my non-exempt employees has earned compensatory time off. Now that the employee is becoming exempt, can s/he retain the compensatory time balance?
A) In accordance with the Fair Labor Standards Act, exempt employees are ineligible to earn or retain a compensatory time off balance, and the balance must be paid off in full, effective with the change to exempt status.
Q) May a non-exempt employee volunteer to work unpaid hours in his/her regular job in addition to his/her regular schedule?
A) No. All non-exempt employees must be compensated for all hours actually worked in his/her regular job.
A) Under certain circumstances, exempt and non-exempt employees may volunteer time. Specifically, non-exempt employees may volunteer for work outside their regular duties and regular hours, and exempt employees may volunteer for work outside their regular duties. Volunteer services must be both (a) offered freely and without pressure or coercion, direct or implied, from the employer, and (b) performed for civic, charitable or humanitarian reasons. If you have any questions about the appropriateness of volunteering time, contact Human Resources.
Q) May a non-exempt employee waive his/her rights to overtime compensation?
A) No. All non-exempt employees are compensated for all hours actually worked at the appropriate rate of pay.
Q) Can the supervisor make a non-exempt employee leave early on Friday so the employee’s total hours will not exceed 40 in the workweek?
A) Yes. This is one method to effectively manage work time and the department budget.
Q) Can exempt employees maintain separate overtime records and receive overtime?
A) No. Exempt employees are ineligible to receive overtime payment or compensatory time off. There are instances, however, when a supervisor might permit flexible work hours to accommodate, for example, an exempt employee who worked an excessive number of hours in a prior workweek or who routinely works more than 40 hours in one workweek.
Q) Who must complete a time record?
A) Non-exempt employees must record all time worked and all paid and unpaid leave used. Exempt employees time is reported on an “exception time reporting” basis. However, some FLSA exempt employees may be required to complete detailed records of hours actually worked, based on the business needs of the work unit.
Q) What is the maximum number of comp time hours that can be earned before the overtime must be paid in cash?
A) After a non-exempt employee has accrued 240 hours of compensatory time, all subsequent overtime hours worked are compensated in cash.