There’s no excuse for anyone to be confused about his or her exempt or nonexempt employment status. Make sure every position description clearly labels the job either salaried or hourly.
Otherwise, employees will turn to the courts to figure out whether you owe them unpaid overtime or whether you have violated the Fair Labor Standards Act () some other way. And that means you’ll be spending extra time and money on attorneys’ fees.
Recent case: Denise Hughes, who worked for an area agency on aging, got caught up in a dispute over whether employees had talked to the press about a sexual harassment lawsuit. At one point, the agency suspended her without pay for two days, a punishment she would later attribute to’s belief that she had spoken with reporters.
About the time the agency settled the harassment suit, it fired Hughes. As is often the case, she went to an attorney, who analyzed her case and tried to come up with various ways to get compensation.
One of those claims was that Hughes was either:
- Nonexempt and therefore entitled to unpaid overtime or comp time when she was fired
- Exempt, in which case her two-day suspension without pay violated the FLSA requirement to pay on a salary basis, with no deductions for missing work.
An appeals court threw the case back to a district court to resolve the contradiction, partly because neither Hughes’ job description nor the employer’s payroll records showed her FLSA status. (Hughes v. Region VII Area Agency on Aging, No. 07-1570, 6th Cir., 2008)