FLSA Definitions

Policy

Loyola University New Orleans is subject to Federal Wage and Hour regulations regarding time reporting and payment of overtime on non-exempt staff and students. The law requires that all employees be correctly classified according to the following Fair Labor Standards Act criteria.

The FLSA assumes that all employees are subject to minimum wage and overtime requirements (i.e., “non-exempt”) unless they are specifically shown to be “exempt”. Employees can be classified as “exempt” only under the following circumstances:

EXECUTIVE EXEMPTION – All of the following tests must be met:

• The employee must be compensated on a salary basis at a rate not less than $455 per week;
• The employee’s primary duty must be managing the enterprise, or managing a customarily recognized department or subdivision of the enterprise;
• The employee must customarily and regularly direct the work of at least two or more other full-time employees or the equivalent; and
• The employee must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight

ADMINISTRATIVE EXEMPTION – All of the following tests must be met:

• The employee must be compensated on a salary basis at a rate not less than $455 per week;
• The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and
• The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance

PROFESSIONAL EXEMPTION – All of the following tests must be met for either the learned professional or the creative professional exemption:

Learned Professional

• The employee must be compensated on a salary basis at a rate not less than $455 per week;
• The employee’s primary duty must be the performance of work requiring advanced knowledge, defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment;
• The advanced knowledge must be in a field of science or learning;
• The advanced knowledge must be customarily acquired by a prolonged course of specialized instruction

Creative Professional

• The employee must be compensated on a salary basis at a rate not less than $455 per week;
• The employee’s primary duty must be the performance of work requiring invention, imagination, originality

OUTSIDE SALES EXEMPTION – All of the following tests must be met:

The employee’s primary duty must be making sales or obtaining orders or contracts for services, or for

• the use of facilities for which a consideration will be paid by the client or customer; and
• The employee must be customarily and regularly engaged away from the employer’s place or places of business

COMPUTER EMPLOYEE EXEMPTION – the following tests must be met:

• The employee must be compensated either on a salary or fee basis at a rate not less than $455 per week or, if compensated on an hourly basis, at a rate not less than $27.63 per hour;
• The employee must be employed as a computer systems analyst, computer programmer, software engineer or other similarly skills worker in the computer field performing the duties described below;
• The employee’s primary duty must consist of:
• The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software or system functions specifications;
• The design, development, documentation, analysis, creation, testing or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications;
• The design, documentation, testing, creation or modification of computer programs related to machine operating systems; or
• A combination of the aforementioned duties, the performance of which requires the same level of skills

Exceptions

• Exceptions to the salary threshold requirement for exemption eligibility include teachers, doctors, dentists and lawyers. They are exempt from the FSLA irrespective of salary.
• Highly compensated employees performing office or non-manual work and paid total annual compensation of $100,000 or more are exempt if they customarily and regularly perform at least one of the duties of an exempt executive, administrative or professional employee.
• Exemptions do not apply to manual laborers or other “blue collar” workers who perform work involving repetitive operations with their hands, physical skill and energy.
• Exemptions do not apply to police, firefighters, paramedics and other first responders regardless or rank or pay level.

Procedure

The Human Resources Department works with department managers to ensure that each job is correctly classified for Wage and Hour law purposes. Managers are responsible for knowing the requirements for exempting a job, or for asking HR when they are in doubt, and for ensuring that no position is classified as exempt that does not meet the FLSA requirements.

The regulations emphasize comparing an employee’s actual job duties with the duty classifications rather than relying on job title or type when determining exemption from overtime.

In cases where it is uncertain whether a job satisfies the criteria of the exemption tests, the position should be classified as non-exempt. The legal penalties can be severe for exempting a job that should be eligible for overtime.