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Why Taking a Salaried Position May Not Be a Step Up

Many people view transfer from an hourly position to a salaried position as a major step forward in their careers, and for many it is. Others, however, are unpleasantly surprised to see their pay dramatically reduced despite the fact they are working the same if not more hours than previously. The answer lies in the exemptions to overtime laws that exist in the Fair Labor Standards Act (FLSA).

Specifically, the FLSA directs that employers need not pay overtime rates to several types of exempt workers, provided those workers receive a salary of at least $455 per week regardless of the actual hours worked:

  • Executive — An executive’s primary duty must consist of managing the company or a recognized subdivision thereof. A bona fide executive must customarily direct at least two full-time employees and have substantial influence in hiring and firing decisions.
  • Administrative — An administrative employee’s primary duty must be non-manual work related to general business operations. These employees must exercise independent judgment in performing their duties.
  • Professional — Professional employees must do work requiring advanced knowledge in a field of science or learning.

Some other classes of employees are exempt as well, and New Jersey has adopted the same exemptions. This means that an hourly employee who customarily works in excess of 40 hours a week may earn significantly less as a salaried employee.

Unfortunately, for this reason employers regularly abuse these rules — most frequently the administrative exemption — by broadly classifying employees as exempt when they should not be and then requiring them to work overtime. If your employer has recently reclassified you as an FLSA-exempt employee and you have seen a drop in pay as a result, a New Jersey wage and hour lawyer can analyze your job description to determine if your classification is appropriate.

Neil  H.  Deutsch Attorney Photo
Neil H. Deutsch

Neil H. Deutsch has been practicing law for over 35 years and is known as a skilled negotiator in employment and discrimination law. He believes in a bottom-line approach of risk analysis and cost effectiveness for his clients. "Case evaluation is something we take seriously," says Mr. Deutsch who seeks top net dollar for his…

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Bruce L. Atkins
Senior Partner

Bruce L. Atkins is the Senior Managing Partner at Deutsch Atkins & Kleinfeldt P.C., a prominent plaintiff employment law firm in the tri-state area. Mr. Atkins believes employees’ rights should be aggressively pursued when they’ve been wrongfully dealt with by their employers. He brings this philosophy to his practice when considering each case and its…

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Adam J. Kleinfeldt

Adam J. Kleinfeldt joined Deutsch Atkins & Kleinfeldt, P.C. in March of 2015.  He primarily represents individuals in employment litigation such as discrimination, retaliation and whistle blowing matters. He has extensive experience in all phases of the litigation process. Adam has obtained significant results for his clients, including a $525,000 jury verdict in a sexual…

Debra M. McGarvey Attorney Photo
Debra M. McGarvey

Debra M. McGarvey joined Deutsch Atkins & Kleinfeldt, P.C. in December 2019. She has extensive experience defending employees and employers in state and federal court in employment litigation matters. She has represented clients on various issues arising out of the New Jersey Law Against Discrimination (NJLAD), the New Jersey Conscientious Employee Protection Act (CEPA), the…

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Carly Skarbnik Meredith

Carly Skarbnik Meredith, Esq. is a Partner at the firm. Carly has focused her career exclusively in the field of employment law. She has a plethora of experience representing both employees and employers with their employment issues, needs, and concerns. She believes representing both employees and employers has made her an extremely well-rounded client advocate.…


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