Paying Overtime and Exempt Employees

Many businesses run the risk of having to pay substantial amounts for back wages, interest, and penalties if they run afoul of the federal laws on minimum wages and overtime pay. Generally, unless an employee fits within one of the exemptions, the employee must be paid one and a half times hourly pay for every hour worked in excess of 40 hours per week; and all employees must be paid at least the minimum wage, currently $7.25 an hour. The source of these laws is the Fair Labor Standards Act, and various regulations enacted by the Department of Labor.

While there are specific exemptions for certain salaried executive, management, administrative, and professional personnel, the exemption does not apply simply because of the job title; there are very specific and intricate legal and factual tests which must be met before the exemption can apply.

The most common problem, however, involves the payment of overtime wages. Whether the employee is compensated by salary, hourly pay, or otherwise, the employer can be liable for overtime wages depending on the specific duties and responsibilities of the employee, and how the employee’s time on the job is recorded.

While the Wage and Hour Division of the Department of Labor has extensive information available, it is certainly recommended that you consult an attorney experienced in this area before making any decisions.

In addition, if you have received notice from the Department of Labor of a complaint or investigation, you need to contact your legal counsel immediately.

For more information, contact Russell Balch at


About Akridge & Balch, P.C.

A full-service law firm serving all of East Alabama. Business and corporate law, financing, estate planning, elder law, real estate, landlord-tenant, bankruptcy, litigation, and family law. "No representation is made that the quality of legal services to be performed is greater than the quality of legal services performed by other lawyers."
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