Should I Be Getting Overtime?

In November 2016, a federal judge blocked the nationwide regulation set to increase the number of employees entitled to overtime and raise the minimum salary requirement for "exempt" (not entitled to overtime) employees.  While this may be a disappointment to employees everywhere, it does not actually answer the question: should YOU be getting overtime?   Your employer may have messed up in two key areas. Let's look at those together: 

1. "Exempt v. Non-Exempt"  

To get out of paying overtime, your employer may have recently made you a "coordinator," a "supervisor," an "assistant manager," an "administrator," etc. Once you got that new title, I'd be willing to bet two things happened: 1. your job didn't change all that much; and 2. you got switched to salary AND you don't get overtime anymore - even though you work just as many hours as before!  What's wrong with this picture?  First, to be "exempt" from overtime under the Fair Labor Standards Act, you actually have to have significant decision-making authority over the actual business of the company.  Your job title alone doesn't count. The Department of Labor requires ALL THREE of these factors to be true: 

  • The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week  (Note: the new Department of Labor rule would have increased this on December 1, 2016, but it got blocked by a judge);
  • The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; AND
  • The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.  (see DOL Fact Sheet 17C for more.)

If you don't meet all three of those tests - or at least seriously doubt that you do - it's time to call a lawyer to see if you should be getting overtime.  For you Arizonans, you can reach me here.  I practice in this area a lot. 

2. "Employee v. Independent Contractor"

This is another major area where companies often get it wrong.  Often they do it just to keep from having to pay you overtime.  Just like with your job title, the label "independent contractor" is meaningless.  The Department of Labor has a lengthy series of factors that they consider in deciding whether you are an employee - but it primarily comes down to the "economic realities" of your position.  Are you truly in business for yourself?  If not, then you're probably an employee. (see DOL Fact Sheet 13 for more). 

Once again, for all you Arizonans, I encourage you to contact me here if you think you may be an employee instead of an independent contractor.  We'll look at your situation together.  

For both of these topics, you can find a wealth of information on the Department of Labor website, but the MOST HELPFUL tool on that site for employees on these specific issues is right here: Wage and Hour Advisor.  You answer a short series of interactive questions and the site will tell you whether you should likely be getting overtime under the Fair Labor Standards Act.  And, if you can get through, you can also call them at 1-866-4USWAGE (1-866-487-9243).    Or, if you're an Arizona worker, you can also contact me.