Managers are always salary exempt and are not eligible for overtime pay.
This is a common belief but it simply isn’t true. In fact, your job title has nothing to do with how you have to be paid–it’s all about your job responsibilities. Steak ‘N Shake found out the hard way that they had misclassified 286 store managers in the St. Louis area and owed them back overtime pay.
Oh, and attorney fees and costs.
Grand total? $7.7 million dollars.
Steak ‘N Shake’s error
The Fair Labor Standards Act requires that everyone receive overtime pay if they work more than 40 hours in a week unless they meet the qualifications for “exemption.” People who manage two or more employees, earn at least $23,660 (set to jump to $35,308 in January 2020) and have hire/fire/discipline power generally meet the conditions for exemption from overtime pay and can be paid a straight salary–regardless of how many hours they actually work. (Some states have additional rules, but these are the federal minimums.)
To keep reading, click here: Steak ‘N Shake Makes a $7.7 Million Error. (You’re Probably Making the Same Error.)