Exempt Employee Definition

Term Definition
An employee who is exempt is one for whom the overtime pay laws enacted by the Federal Labor Standards Act don’t apply.

Extended Definition
When a company hires employees who qualify as exempt, they are not required by law to pay these employees overtime. These employees typically earn a salary and as thus, don’t work overtime, regardless of their hours. To determine who is exempt, a company must follow particular standards. Some jobs, for instance, automatically qualify as exempt, while others must meet certain requirements to be exempt.

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Exempt Employees Must Meet Specific Qualifications