Docking the pay of exempt employees is only permissible in certain circumstances. The Fair Labor Standards Act (FLSA) governs wage and hour laws of nonexempt employees. The law requires employers to pay nonexempt employees at least the federal minimum wage and requires the payment of overtime for an employee who works more than 40 hours in a week. Employees who are exempt from the law are not entitled to overtime or the federal minimum wage, but employers may not make improper pay deductions from their salary. Exempt Employees Under FLSAThe FLSA does not apply to certain types of workers, including executives, administrators, professionals, outside sales people, and some computer employees. To be exempt, the employee must meet certain requirements regarding job duties and — excluding outside sales employees and teachers — must be paid on a salary basis. Exempt employees must receive a salary of at least $455 per week. An exempt computer employee must receive a salary of $455 per week or at least $27.63 per hour. Impermissible Pay DockingIn order for an employee to qualify as exempt, the employee must receive a predetermined wage each pay period. The law prohibits the employer from docking the pay of an exempt employee because of the “quality or quantity” of the work. This means that an exempt employee must receive a full weekly salary when any work is performed during the week (the number of hours or days worked is immaterial) and when work is unavailable but the employee is ready, available, and able to work. The FLSA allows employers to make deductions of an exempt employee’s salary under certain circumstances, including: Penalties for Impermissible Pay DockingAn employer that engages in the “actual practice” of improper pay docking is subject to penalties if it is established that the employer did not intend to pay the employee on a salary basis. The court will consider several factors when making this determination, including: The employer will receive safe harbor from losing the overtime exemption if: FLSA Lawyer Free ConsultationWhen you need legal help with an employer employee matter in Utah, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
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