Are My New York State Employees Exempt from Overtime Pay?

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The title of this post poses a question asked often by many of our clients. Before delving into which employees are exempt from overtime pay, let’s take a look at the minimum pay requirements and what a regular work week entails for most New York employees.

As of July 2009, the New York State Minimum Wage Act, N.Y. Labor Law §§ 650-665, and section 142-2.1 of Title 12 of the New York Codes, Rules and Regulations require that employees in New York be paid at the basic minimum hourly rate of $7.25 per hour. In general, overtime is calculated based on the number of hours worked on a weekly basis, and under New York Labor Law, employers are required to pay most employees overtime pay at the rate of 1½ times their regular, “straight-time” hourly rate for all hours worked over 40 in a workweek. 12 N.Y.C.R.R. § 142-2.2.

Some occupations, however, are exempt from the overtime pay provisions of the New YorkState Labor Law Section 651[1] and the Fair Labor Standards Act (“FLSA”), including:

  • Executive Employees;
  • Administrative Employees;
  • Professional Employees;
  • Outside Salespeople;
  • Individuals Working for a Federal, State, or Municipal Government;
  • Farm Laborers;
  • Certain Volunteers, Interns and Apprentices;
  • Taxicab drivers;
  • Members of Religious Orders;
  • Certain Individuals Working for Religious or Charitable institutions;
  • CampCounselors;
  • Individuals Working for a Fraternity, Sorority, Student or Faculty Association; and
  • Part-time Baby Sitters

Exempt employees are those individuals who generally perform high-level work or work in a “learned professional.” If an employee is holds an exempt status, the employer is not required to pay that employee overtime. When considering whether one of your employees will be “exempt,” keep in mind the following:

An exempt “executive” employee is defined as an employee:

(a) whose primary duty consists of the management of the enterprise in which such individual is employed or of a customarily recognized department or subdivision thereof;
(b) who customarily and regularly directs the work of two or more other employees therein;
(c) who has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight;
(d) who customarily and regularly exercise discretionary powers; and
(e) who is paid for his services a salary of not less than: $ 543.75 per week on and after July 24, 2009, inclusive of board, lodging, other allowances and facilities.

12 N.Y.C.R.R. § 142-2.14(c)(4)(1).

An exempt “professional” employee is defined as an employee:

(a) whose primary duty consists of the performance of work: requiring knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study, as distinguished from a general academic education and from an apprenticeship, and from training in the performance of routine mental, manual or physical processes; or original and creative in character in a recognized field of artistic endeavor (as opposed to work which can be produced by a person endowed with general manual or intellectual ability and training), and the result of which depends primarily on the invention, imagination or talent of the employee; and
(b) whose work requires the consistent exercise of discretion and judgment in its performance; or
(c) whose work is predominantly intellectual and varied in character (as opposed to routine mental, manual, mechanical or physical work) and is of such a character that the output produced or the result accomplished cannot be standardized in relation to a given period of time.

12 N.Y.C.R.R. § 142-2.14(c)(4)(iii).

An exempt “outside sales person means an individual who is customarily and predominantly engaged away from the premises of the employer and not at any fixed site and location for the purpose of:

(i) making sales;
(ii) selling and delivering articles or goods; or
(iii) obtaining orders or contracts for service or for the use of facilities.”

12 N.Y.C.R.R. § 142-214(c)(5).

Since neither employers nor employees are allowed to waiveNew York’s overtime pay requirement, the decision to classify an employee should be made with careful consideration given to the characteristics of the job. If an employer withholds a non-exempt employee’s rightful overtime wages, they may be subject to a civil lawsuit and the employee will usually be entitled to back pay for their overtime hours.

If you or your company have any questions or concerns about this topic and would like further information, please email Jennean Rogers at jrogers@cullenanddykman.com.

A special thanks to Sean Gajewski, a law clerk at Cullen and Dykman LLP, for helping with this post.

 

Published In: Administrative Agency Updates, Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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