Certain employees meeting specific criteria may be exempt from the overtime requirements. While many people use the terms “salaried” or “hourly,” those terms are not always correct. An employee who is not subject to overtime is considered to be “exempt.” An employee who is entitled to overtime pay for hours worked in excess of the overtime threshold is considered to be “nonexempt.”
To be exempt from overtime an employee must meet three tests. First, the employee must be paid on a salaried basis, although some salaried employees may not be exempt from overtime. Second, the employee must be paid at least $455 per week or $23,659.92 per year. Third, the employee must meet the job duties test. There are three classifications of exempt employees for the job duties test. They are the executive exemption, the administrative exemption, and the professional exemption.