Exemptions change: Review duties each year

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in Leaders & Managers,Management Training

Are all your employees performing the same tasks as when they were hired? Probably not.

Job duties change all the time. Sometimes, workers take on extra duties as they become more experienced or—more likely lately—they absorb roles of a laid-off colleague.

As those duties change, make sure you regularly update employees’ job descriptions to reflect realities on the ground. Then use that job description to see if the person is still properly classified under the Fair Labor Standards Act (FLSA) as either exempt (not eligible for overtime pay) or nonexempt (eligible for overtime).

Don’t rely on an analysis that’s even a couple of years old. As this case shows, even an analysis provided by the U.S. Department of Labor itself isn’t safe.

Recent case: Fredda Malena, an executive assistant in the corporate offices of Victoria’s Secret, worked more than 40 hours per week but didn’t receive overtime because the company designated its executive assistants as exempt.

To support its position, the company pointed to a U.S. Department of Labor FLSA audit in 2005. The audit analyzed one specific executive assistant position at the company and concluded the job was properly classified as exempt. So the company decided all executive assistants were exempt.

The court rejected that argument, saying the audit looked at only one specific position, and that jobs can change over time. What matters are the duties—not the title. (Malena v. Victoria’s Secret Direct, No. 09-Civ-5849, SD NY, 2010)

Final note: Updating job descriptions should be an annual event, and employees should be involved. Have them review their current job descriptions and add or delete tasks to reflect the actual work performed. Then have them sign the revised job description. Employees will have a harder time challenging a job description if they helped craft it.

Online resource: To analyze your employees’ classifications, download our free FLSA Checklist: Exempt vs. Nonexempt Status.

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