Executive, Administrative and Professional Exemptions FLSA 29 CFR 541

Executive, Administrative and Professional Exemptions

FLSA 29 CFR 541

Guaranteed Salary Salary Salary notnot subject to deductionssubject to deductions

Paid the same promised salary each pay day (can be paid semi-monthly or monthly)

Salary must be $455.00 per week Initial and termination weeks can be

prorated by day Partial day deductions are prohibited

Guaranteed salary continued:Full day deductions allowed only if:

With Leave Plan:

Employee voluntarily absent for a full day

Sick, and has exhausted a sick or leave plan

Without Leave Plan:

If no leave plan in place, can not deduct for sickness

If one hour is worked the whole week is payable

Executive ExemptionMust meet all criteria

Primary Duty must be management Supervises two full time employees Authority to hire and fire or recommend Customarily and regularly exercise

discretionary powers Guaranteed salary of more than

$455.00 per week

Primary duty must be management:

Hired to function as the manager More than 50% of time spent

supervising Recognized as the supervisor Job title is not significant What do they actually do?

Supervise two or more employees:

Two full-time employees or part time equivalent

Must be 80 hours of labor Can be three or four part as long as it is 80

hours Must be direct supervision

Authority to hire and fire or recommend:

Must have exercised that authority Must be part of the evaluation process Must have ability to set rates of pay Some weight has to be given to their

recommendations

Customarily and regularly exercise discretionary powers:

Make independent decisions

Set schedules Call for service work

if there is a breakdown

Answer the phone Call for help Ability to fix what is

broken Not very well

defined

Administrative ExemptionCriteria for determination:

Office or non-manual work directly related to management policies or general business operations; OR

Academic instruction or training carried out in the administration of a school system or educational establishment; AND

Criteria continued:

Customarily exercise discretion and use independent judgement

Assist a proprietor or bona fide executive Perform work only under general supervision along

specialized or technical lines that require special training

Execute special assignments Spend no more than 20% of time (40% in retail or

service establishment) on non-exempt work Must be paid on a salary or fee basis of $455.00 per

week

Who are these employees?

Thinkers and planners Advisory specialists, buyers, purchasing

agents Wage rate analysts Safety directors Human Resource managers People that make decisions that affect

profit and loss

Who are they in schools?

Academic administrative employees

Principals and heads of departments

Who are they NOT!!!

Bank tellers, bookkeepers Secretaries Shipping and receiving clerks Accounts receivable and payable staff Payroll staff Building management and maintenance

Key Issues

Perform no production work of any kind

They are not the people who do not fit the other exemptions

Professional Exemptions

Learned

Artistic

Teaching

Learned Professions

Knowledge of an advanced type, four year degree or its equivalency

Field of science of learning Examples – attorneys, doctors, registered

nurses, architects, and engineers Technologists not technicians

Artistic Professions

Creative work requiring imagination or invention

Talent, entertainment industry personnel, radio and television talents, actors and musicians

Teaching Professionals

Certified or recognized

Educational institution or school system

Other criteria

Exercise discretion and judgement Work is predominantly intellectual and varied

– as distinguishable from routine or mechanical

Not more than 20% of time is spent on activities not essentially a part of the professional duties

Salary or fee of $455.00 per week

Exemptions from the salary test:

Holder of a valid license in the practice of law or medicine and engaged in the practice

Medical interns or residents Teachers in schools or education

institutions

“Salary test” waived

Limited to highly skilled computer analysts, programmers, software engineers and specialists, etc.

If employee is compensated at 6 ½ times the minimum wage in effect at the time of the change

$4.25 x’s 6 ½ = $27.63 per hour

For further information:

Contact info: Illinois Dept of Labor

Fair Labor Standards

312-793-2804

Website: www.state.il.us/agency/idol/