Administrative Staff and Overtime
Often employers misclassify administrative employees such as executive assistants, secretaries, and administrative assistants as exempt from the overtime pay laws under the administrative exemption. However, employers fail to realize that most ordinary administrative duties are not significant enough to rise to the level required by the administrative exemption. Just because an employee does administrative work does not mean that they are “administratively exempt” under overtime rules.
In order for an administrative employee to be exempt under the Administrative Exemption:
- The employee must be compensated on a salary or fee basis at a rate not less than $455 per week;
- 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 must include the exercise of discretion and independent judgment with respect to matters of significance.
In order to qualify for the exemption, the employee’s work must be directly related to assisting with the running or servicing of the business. This type of work would include work in the following:
- advertising and marketing
- personnel management
- human resources
- labor relations
- quality control
- other similar activities
In addition, the employee’s duty must include the exercise of discretion and independent judgment. Generally, this means that the employee has the authority to make an independent choice free from immediate direction or supervision. Some examples would be:
- the employee has the authority to make or implement management policies
- the employee performs work that substantially affects the business operations
- the employee has the authority to commit the employer in matters with significant financial impact
- the employee can deviate from established policies without prior approval.
The level of importance or consequence of the work will determine whether it is a matter of significance.