A non-exempt employee refers to an employee whose overtime hours do not have to be paid in accordance with the U.S. Fair Labor Standards Act (FLSA).
What Does It Mean to Be a Non-Exempt Employee?
A non-exempt employee from FLSA must earn a salary of more than $684 per week or $35,568 annually, and occupy an administrative, professional, management, IT or external sales position.
Non-exempt employees are not necessarily paid for overtime hours worked, but may receive other types of compensation depending on their employment contract.
What Are the Categories of Non-Exempt Employees?
Non-exempt employees must occupy a position in one of the following job categories:
- Information technology
- External sales
- Vocational practices
What Are the Disadvantages of Working with a Non-Exempt Employee?
The disadvantages of working with a non-exempt employee include:
- Lack of motivation to work overtime, since overtime is unpaid
- A higher salary associated with the employee’s job category
- The need to pay employees for statutory holidays.
What Is the Difference Between Non-Exempt and Exempt Employees?
A non-exempt employee under the FLSA does not necessarily receive compensation for overtime, whereas an exempt employee must be paid at time-and-a-half for hours beyond 40 per week.
How Do I Determine the Salary of a Non-Exempt Employee Versus an Exempt Employee?
An exempt employee must be paid the minimum wage in effect in the state where they works.
A non-exempt employee must earn a minimum of $684 per week or $35,568 annually, but may be paid more depending on their role.
What Are the Differences Between Non-Exempt and Exempt Employees in Canada and the U.S.?
In Canada, the Canada Labour Code does not classify employees according to their status. All employees must receive compensation for overtime unless their employment contract stipulates otherwise.