What is an exempt vs. non-exempt employee?
Exempt Employee: Employees with exempt status are exempt from the protections of the wage and hour laws of their state, or of the Federal government (Fair Labor Standards Act). Examples of exempt employees under Federal law are “executives,” “professionals” and full-time students, as defined under the Fair Labor Standards Act. Exempt employees must always be paid on a salary basis, not subject to reduction based on the quality or quantity of work performed. Non-Exempt: Employees with non-exempt status are generally protected by the wage and hour laws of your state, or of the Federal government (Fair Labor Standards Act). Wage and hour laws require employers to pay at least a certain minimum hourly wage rate and a premium rate for overtime work. They are also a guide for determining which on-the-job hours constitute work, and thus must be compensated.
