Fair Labor Standards Act (FLSA) Overtime Regulations Checklist #2 - SALAR A!" "#$%&S $&S$S FOR A"'%!%S$RA$%(& &)&'*$%O!

FRO' O(&R$%'& &++ective August 2,- 2../ If questions A, B, and C, or questions A and D, are all answered yes, the employee meets the administrative exemption test. A. Is the employee paid a salary of at least $ !! per wee", or the entry level salary for a professional instru#tor in the #ase of a#ademi# administrative personnel$ %es&&&&&& 'o &&&&&&& 'ote( )he same #riteria for salary dis#ussed under the exe#utive exemption, apply to the *usiness administrative exemption. B. Does the employee+s primary duty #onsist of the performan#e of offi#e or non, manual wor" dire#tly related to mana-ement poli#ies or -eneral *usiness operations .i.e., administrative wor"/ of the employer or its #ustomers, as opposed to wor" primarily involvin- produ#tion or sales of -oods or servi#es$ %es&&&&&& 'o &&&&&&& 0. In order to identify administrative versus produ#tion wor", you must first identify the produ#t.s/ or servi#e.s/ provided *y the employer. In other words, identify the primary *usiness a#tivities of the employer .1ow does the employer -enerate revenue$/ After identifyin- the #ompany+s produ#t.s/ or servi#e.s/, determine whether the employee+s wor" primarily involves produ#in- the produ#t or deliverin- the servi#e. )he administrative operations of the *usiness in#lude advisin- mana-ement, plannin-, ne-otiatin-, representin- the #ompany, pur#hasin-, promotin- sales, and *usiness resear#h and #ontrol. )hese a#tivities frequently in#lude tax, finan#e, a##ountin-, audit, insuran#e, quality #ontrol, pur#hasin-, advertisin-, mar"etin-, resear#h, safety and health, personnel mana-ement, employee *enefits, la*or relations, pu*li# relations, and -overnment relations. Administrative duties do not in#lude routine or stru#tured tas"s su#h as *oo""eepin-, data ta*ulation, or #leri#al duties.

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456A Administrative 6alary and Duties )ests for 7xemption from 8vertime

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)he administrative wor" must *e of su*stantial importan#e to the mana-ement or operation of the *usiness, su#h as wor" affe#tin- the development of poli#ies or responsi*ilities to exe#ute or #arry out poli#y. )o qualify as a primary duty, the employee+s prin#ipal or most important duty must involve performin- the hi-h,level administrative fun#tions. =hen an employee spends less than the ma>ority of his?her time performin- hi-h level administrative fun#tions, the employee may still qualify under the administrative exemption if( a. *. #. d. the relative importan#e of the hi-h,level administrative duties is -reater than the other types of duties@ the employee frequently exer#ises dis#retionary powers@ the employee is relatively free from supervision@ and the employee+s salary is distin-uisha*le from the wa-es paid to other employees who perform the same "ind of non,exempt wor".

;. <.

Do the employee+s duties in#lude wor" requirin- the exer#ise of dis#retion and >ud-ment$ 0. 2. %es&&&&&& 'o &&&&&&& )he employee must exer#ise dis#retion and independent >ud-ment with respe#t to matters of si-nifi#an#e as opposed to daily routine de#isions. Independent >ud-ment and dis#retion involves the #omparison and evaluation of possi*le #ourses of #ondu#t and havin- the authority to ma"e an independent #hoi#e, free from immediate dire#tion with respe#t to matters of si-nifi#an#e. It also does not in#lude the use of manuals, -uidelines or software pa#"a-es to ma"e determinations. )he exer#ise of independent >ud-ment and dis#retion does not in#lude the use of s"ill in applyin- te#hniques, pro#edures, or spe#ifi# standards. Dis#retion and independent >ud-ment may *e( a. *. #. ma"in- a de#ision to depart from pres#ri*ed standards or permitted toleran#es@ ma"in- de#isions that affe#t the operational poli#ies of the employee+s department@ formulatin- re#ommendations to a #ustomer for the pur#hase of se#urities@
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456A Administrative 6alary and Duties )ests for 7xemption from 8vertime

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ma"in- de#isions in #onne#tion with ne-otiations where the individual is -iven reasona*le latitude in #arryin- on those dis#ussions, whi#h are *indin- on the employer@ formulatin- re#ommendations, even if mana-ement personnel must review and a##ept the re#ommendation prior to implementation@ formulatin- or parti#ipatin- in the formulation of poli#y for the *usiness unit@ or *road authority to #ommit the employer in su*stantial respe#ts finan#ially.

e. f. -. !.

Dis#retion and independent >ud-ment is not( a. *. #. d. e. f. -. h. applyin- "nowled-e, followin- pres#ri*ed pro#edures or determininwhi#h pro#edures to follow@ determinin- whether spe#ified standards have *een satisfied, even if there is some leeway in rea#hin- a #on#lusion@ performin- inspe#tion fun#tions *y followin- esta*lished te#hniques and pro#edures with s"ills a#quired throu-h spe#ial trainin- or experien#e@ formulatin- re#ommendations *ased upon the development of fa#ts #on#ernin- #onformity with a "nown standard@ #omparin- items *ased upon esta*lished standards, "nown throu-h experien#e or written manuals@ s#reenin- appli#ants or #ondu#tin- interviews to determine satisfa#tion of #ertain minimum qualifi#ations@ ma"in- de#isions that do not #ommit the employer in su*stantial respe#ts finan#ially or otherwise@ or ne-otiatin- settlements with poli#y holders where the individual is not -iven reasona*le latitude in #arryin- on those ne-otiations.

D.

Does the employee+s primary duty #onsist of the performan#e of offi#e or non, manual wor", dire#tly related to a#ademi# instru#tion or trainin- in an edu#ational institution$ %es&&&&&& 'o &&&&&&& 0. An edu#ational institution in#ludes an elementary or se#ondary s#hool system, an institution of hi-her edu#ation, and spe#ial s#hools for mentally or physi#ally disa*led or -ifted #hildren, with no distin#tion *etween pu*li# and private or-aniAations.
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456A Administrative 6alary and Duties )ests for 7xemption from 8vertime

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A#ademi# administrative a#tivities mean wor" dire#tly related to the a#ademi# operations and a#ademi# fun#tions of the institution, su#h as administration of #urri#ulum, examination of quality and methods of instru#tion, measurement of learnin- potential and a#hievement, maintenan#e of a#ademi# and -radinstandards, and other aspe#ts of a tea#hin- pro-ram. A#ademi# administrative responsi*ilities do not in#lude *uildin- mana-ement and maintenan#e, supportin- the health of students, or a#tivity performed *y so#ial wor"ers, psy#holo-ists, or even dieti#ians.

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456A Administrative 6alary and Duties )ests for 7xemption from 8vertime

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