FLSA Exempt
A worker classification under the Fair Labor Standards Act for employees who are not entitled to overtime pay because they meet specific salary and duties tests.
What Does FLSA Exempt Mean?
The Fair Labor Standards Act (FLSA) divides employees into two categories: exempt (not entitled to overtime) and non-exempt (entitled to overtime at 1.5 times the regular rate for hours over 40 in a workweek). Exempt status applies only to employees who meet both a salary test and a duties test specified in U.S. Department of Labor regulations.
The Three Main Exemption Categories
- **Executive exemption**: primary duty is managing the enterprise or a department, regularly directs the work of at least two full-time employees, and has authority to hire or fire (or recommendations are given particular weight) - **Administrative exemption**: primary duty is office or non-manual work directly related to management or general business operations, exercising discretion and independent judgment on significant matters - **Professional exemption**: primary duty requires advanced knowledge in a field of science or learning customarily acquired by prolonged specialized instruction (learned professional) or invention, imagination, originality, or talent (creative professional)
Salary Threshold and Compliance
As of January 2025, exempt employees generally must earn a salary of at least $1,128 per week ($58,656 annually). Highly compensated employees earning $151,164 or more annually may qualify under a relaxed duties test. Job titles alone do not determine exempt status — the actual duties performed control. Misclassification can result in back pay for two to three years of overtime, liquidated damages, and attorneys' fees. Employers should periodically audit classifications and reassess after job duties change.