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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.

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Neil H. Deutsch
Senior Partner

About 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…

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Bruce L. Atkins
Senior Partner

About Bruce L. Atkins is regarded as one of New Jersey's premiere practitioners of employment and civil litigation. Mr. Atkins has also been included in the Thomson Reuters list of New Jersey Super Lawyers* in Employment Litigation since 2005. Mr. Atkins believes employees have rights that should be aggressively pursued when an employer has wrongfully dealt…

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Adam J. Kleinfeldt
Partner

About Adam J. Kleinfeldt joined Deutsch Atkins, P.C. in March of 2015.  He primarily represents individuals in employment litigations 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 some of his clients, including a $525,000 jury verdict in a…

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Robert J. Pantina
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About Robert J. Pantina joined the firm in 2018. Mr. Pantina received his B.A. from Rider University in 2008. He received his J.D. from the Elisabeth Haub School of Law at Pace University in 2017. While in law school, Mr. Pantina interned for the Hon. Bonnie J. Mizdol, Assignment Judge of the Superior Court of…

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Diane Englander Peyser
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About Diane Englander Peyser joined Deutsch Atkins, PC in September 2018 where she represents employees in wrongful termination, retaliation, harassment, and discrimination matters. Prior to joining Deutsch Atkins, PC, Diane represented clients in all aspects of employment law on behalf of employees involving unemployment appeals, claims of sexual harassment, LGBT discrimination, disability discrimination, FMLA, New…

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