Wage theft is a serious concern in the United States. Despite numerous laws protecting the rights of workers, there are thousands of employees each year who do not receive the full pay for their labor that they should. There are many companies that do not abide by federal and state regulations establishing wage standards and pay rules for workers, and there is also a lot of confusion about what these laws require.
Sometimes, the people working at a company may allege that they did not receive the wages they should, and frequently those claims involve overtime pay. Overtime wages are at least 150% of someone’s typical hourly wage, which is certainly a contributing factor to the disputes that they generate. Companies may try to claim that workers are exempt when they are not, and workers may try to claim they deserve overtime pay when they do not.
Which workers are exempt from overtime pay requirements?
Well-compensated salary workers
The best-known category of exempt employees includes those paid on a salary basis. When someone’s income is the same each year regardless of how much time they work, they are generally exempt from overtime pay if their wages meet a base standard set by the federal government, which is currently $35,568. Both hourly workers and those paid on a daily basis typically have a right to overtime pay if they work more than 40 hours in a specific work week.
Self-employed individuals or independent contractors
Those who technically work for themselves and have a contract with a company do not have the same right to overtime wages as an employee. However, workers who believe a company misclassified them to pay them as independent contractors while treating them as employees may still be in a position to bring a claim against the company for unpaid overtime.
It will not be the tax paperwork that someone executes when starting a job but rather the nature of their employment arrangements and the type of work that they do that will ultimately determine if they are an independent contractor exempt from overtime rules or an employee unfairly denied overtime pay.
Seeking legal guidance to clarify whether or not an employee is exempt from overtime rules can help settle a dispute about unpaid overtime or possibly motivate someone to pursue a wage claim against their employer.