Red Flags That Your Job is Misclassified as Exempt (Costing You Thousands Each Year)

There’s a very good chance your employer has classified you as an exempt employee in California, and assumes you aren’t protected by the federal government’s Fair Labor Standards Act, or FLSA. This misclassification costs employees millions of dollars in compensation every year, in overtime pay, as well as pay for meal and rest breaks.

Companies violate exempt employment laws on a regular basis. Some are ignorant of the law. Others are trying to game the system.

These are just some of the red flags that indicate you’ve been wrongly classified as being exempt from FLSA requirements. If any of these apply to your specific employment situation, you should talk to an attorney with Drew Lewis, PC to make sure your rights are protected.

1. You’re Not Being Paid on a Salary Basis

In order for an employee to be exempt, he or she must receive a salary. That salary has to be at least twice the California minimum wage. It must be a fixed amount that doesn’t go up or down based on either the quality of your work or the hours that you work each week.

If you work at a company with 25 or fewer employees, you must make a salary of at least $49,920 as of 2020. For companies with 26 or more workers, the minimum salary is $54,080. If your employer doesn’t pay you per hour and you don’t make the minimum amount required for the size of your company, then you’re considered a non-exempt employee in the eyes of the FLSA. That means you should be paid for any hours over 40 you work in a week, and you must also be paid for meal and rest breaks.

2. Your Employer Fails the “Duties Test”

This sounds like legal jargon, but it’s really easy to understand. It simply means that you have to perform certain duties in order to be considered an exempt employee in California.

For example, you have to work in an administrative position, such as managing back office operations and having significant decision-making authority. Or, your job responsibilities must involve special training or advanced knowledge in your field. Another area where you’ll be exempt under employment laws is if you’re a manager, you supervise two or more employees, and you have hiring and firing authority. Your employer can’t just slap a “manager” label on you and assume you’ll be exempt.

3. You’re Not Being Paid Overtime

This one is huge, and it’s probably the worst example of misclassification. An exempt employee in California isn’t required to receive overtime pay per the FLSA. But if you’re non-exempt, you need to receive 1.5 times your hourly rate whenever you work more than 40 hours in one work week, or if you work between 8-12 hours in one workday. If you work more than 12 hours in one day, you’re required to receive double your hourly rate once you work past the 12-hour mark.

Protect Your Rights – Talk to an Employment Attorney

These red flags represent just a few of the many ways California employers regularly fail to pay their workers the compensation they deserve. A misclassification of an exempt employee in California not only violates the FLSA, but also state employment laws.

There are attorneys that are experts in California exempt employment laws. If you have a legitimate claim to lost wages, they’ll fight passionately on your behalf, and work to get you every last nickel you have coming.