Look at employees’ duties, not titles, to decide exempt status — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
  • LinkedIn
  • YouTube
  • Twitter
  • Facebook
  • Google+

Look at employees’ duties, not titles, to decide exempt status

Get PDF file

by on
in Human Resources

Many employers believe that anyone with a "manager" title is automatically exempt from overtime. The risk: Making such misclassification mistakes can cost thousands in back pay and penalties, plus a black mark on your record.

Action: Focus only on the employees' duties, not their titles, when seeing who earns FLSA exemptions under the new rules.

Managers are exempt from overtime, right? Wrong. The term "manager" means different things in different organizations. That's why it's important to look at each employee's specific duties and responsibilities when deciding whether he or she is eligible for overtime under the Fair Labor Standards Act (FLSA).

That's especially true in specific industries that have enjoyed overtime exemptions for years. Most are based on unique jobs with special requirements, such as truckers who move goods from state to state. But attempts to stretch these industry-specific exemptions to other jobs often fail.

Case in point: A dozen drivers sued the Pittsburgh Transportation Company (PTC), a private bus company for disabled people. The drivers routinely drove more than 40 hours per week, but the PTC didn't pay overtime, arguing that they were exempt because the Motor Carrier Act excludes many truck drivers from the FLSA.

However, that law refers to drivers who move goods across state lines. The PTC bus drivers transported customers to and from doctor appointments. The PTC couldn't prove that its drivers were engaged in interstate commerce (such as delivering riders to airports), so it had to pay the drivers overtime. Labeling the employees as "exempt truck drivers" wasn't enough; what counted was how they did their jobs. (Packard v. Pittsburgh Transportation Co., No 03-3-88, 3rd Cir., 2005)

Leave a Comment

Previous post:

Next post: