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Am I Entitled To Overtime Pay When I’m Paid A Salary In New Jersey?

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Kenneth J. Katz - Employment & Labor - Super Lawyers

Answered by: Kenneth J. Katz

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Many salaried employees in New Jersey must still receive overtime pay despite being compensated on a salary basis. Being paid a salary only partially determines whether you are eligible for overtime pay under the federal Fair Labor Standards Act (FLSA) and New Jersey state law.

It is important to note that your employer does not have the final say on where your employment classification falls. Employers often misclassify employees, both intentionally and unintentionally, thereby depriving those workers of the benefits and pay to which they are entitled under the law. 

What Is The Earning Threshold For Overtime Eligibility?

As of Jan. 1, 2020, a new rule issued by the U.S. Department of Labor states that employees who earn less than $35,568 per year are entitled to receive overtime pay, regardless of whether they are salaried or paid an hourly wage. This was an increase from the previous threshold of $23,660, which was implemented in 2004.

Is Salary The Only Factor?

No. Salary is just one of the components that the FLSA and New Jersey law consider when determining overtime eligibility. Other important factors relate to job duties and area of employment.

Generally, to be exempt from overtime pay, you must be salaried, meet the minimum salary threshold, and have high-level job duties or some creative or decision-making responsibilities. However, there are gray areas and specific requirements that can further complicate matters. 

Which Job Classifications Are Excluded From OT? 

Salaried employees earning more than $35,568 per year may be exempt from overtime if they fall into one or more exempt employment classifications based upon their job duties and responsibilities. Exempt classifications include, but are not limited to: 

  • Executive, administrative, and professional roles
  • Outside salespeople
  • Computer employees such as systems analysts and software engineers
  • Some farm and hotel workers 
  • Certain religious positions

These categories are strictly defined, and a salaried employee must satisfy specific tests in order to fall into one or more of these classifications. However, some salaried employees who earn significantly more money than the typical worker may be exempt from overtime if their take-home pay even if they only partially satisfy the tests of one of the aforementioned exempt employment classifications.

How Do Job Titles And Duties Affect My Eligibility? 

Like salary, a job title alone does not determine exempt status. Here are two examples:

  • An administrative assistant may not be excluded from earning overtime if their responsibilities do not involve making significant business decisions
  • Similarly, a retail manager may not qualify for the executive exemption if the manager’s primary responsibilities are on-floor sales and maintenance work rather than traditional management duties

Depending on the division of labor and their specific roles, both of the above workers may be eligible to receive time-and-a-half pay for hours worked over 40 in a week. Determining exempt status can be tricky and is highly dependent on the actual work that the employee performs. Many employers are unfamiliar with the rules, while others intentionally misclassify workers to improve their bottom lines. 

How Much Should I Be Earning For Overtime?

Overtime must be paid at a rate of one and one-half times an employee’s regular hourly rate or the minimum wage rate, whichever is higher. In New Jersey, the minimum wage is currently $12 per hour, so the minimum overtime rate is $18 per hour for hours worked over 40 per week.

Can I Recover Lost Overtime Pay If My Employer Doesn’t Follow The Rules?

Yes. We help hourly and salaried employees recover unpaid overtime wages for hours worked over 40 in a week. If you feel you are owed overtime pay, an experienced employment law attorney can answer your questions and provide you with options.

Those earnings can be recouped regardless of whether the employer intentionally or unintentionally misclassified you. All unpaid wage claims are unique, so get the advice you need by contacting an experienced and skilled employment attorney for a free consultation.

Disclaimer: The answer is intended to be for informational purposes only. It should not be relied on as legal advice, nor construed as a form of attorney-client relationship.

Disclosure: No aspect of this advertisement has been approved by the Supreme Court of New Jersey. Please visit the Super Lawyers Selection Process for a detailed description of the Super Lawyers selection methodology.

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