Exempt Position

Exempt Position is a job classification category of the Fair Labor Standards Act (FLSA) in the United States. Under FLSA, the exempted positions are exempt from provisions regarding overtime pay and minimum wage requirements. Classified as non-exempt positions, employees working outside the 40 hours a week threshold receive a salaried payment. The FLSA explicitly specifies that certain job positions must pass some criteria to be exempted from some of these categories such as the job duties, salary level and exemption tests for executive, administrative, professional, outside sales and some computer-related positions.

Example of Exempt Position

Imagine a marketing agency that consists of both exempt and nonexempt employees. In the company, the marketing manager is an exempt worker, and the administrative assistants who report to the manager are nonexempt ones. The pay for exempt employees like the marketing manager is fixed irrespective of the number of hours they work in a week. As most of the manager's tasks would entail managerial duties, strategic planning, and decision-making, they are not covered under FLSA, the overtime pay requirements. For instance, the clerical staff who provides administrative support and performs routine administrative work is deserving of overtime pay if they work for more than 40 hours a week. The company can stay up to date with the labor laws and fair compensation practices, and also maintain the same time while properly classifying job positions as exempt or non-exempt.