What Is the Meaning of a Salaried Employee?
A salaried employee varies from an hourly worker in a few ways. The latter is paid based on the number of hours worked and the former receives a set income each pay period. Furthermore, hourly employees may be required to punch a time clock, and salaried employees do not. A number of federal regulations also apply to salaried employees.
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Definition
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The U.S. Department of Labor defines salaried employees as those who are paid on a salary rather than an hourly basis. This general rule applies if the employee frequently receives a predetermined amount each pay period or on an infrequent basis. For instance, upon hiring an employee, the employer sets his salary at $50,000 per year, which is $1,923.08 per biweekly paycheck. The employee's net pay does not change unless he has had a change in his deductions (such as taxes) or pay rate.
Exemptions
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Under the Fair Labor Standards Act (FLSA), a number of salaried employees are exempt from minimum wage and overtime pay. This includes executive, professional and administrative employees, and some computer and outside sales workers. These groups must satisfy the minimum salary requirement and meet related testing requirements to qualify for exempt status.
For example, an administrative employee is exempt if she is paid a minimum salary of at least $455 per week. Furthermore, her main duty must be doing nonmanual or office labor directly linked to management or to the employer's overall business operations. In addition, she must apply personal judgment and discretion in matters requiring them.
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Weekly Pay
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A salaried worker's pay cannot be docked because of changes in his work quality or quantity of work done. If he performs work in a given week, he must be paid a full salary, regardless of the number of days he works. But if he does not work at all in a given week, the employer does not have to pay him for that week.
Pay Exceptions
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If the salaried worker takes a half day off to handle personal affairs, the employer must pay her for the full day. But if she takes one and a half days off to handle personal matters, the employer may dock her pay for one day. If the employer offers benefit days, such as sick days and disability, he can dock the employee if she has exhausted all her paid days off but still takes more. He can also dock her pay if she breaks the company's safety rules. For example, he can suspend her without pay for violating smoking rules, particularly in an explosive environment.
Starting and Final Pay
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Upon hiring or terminating an employee, the employer may pay him only for the days worked within the pay period. For instance, if the employee is hired five days into the current pay period, the employer can pay her from her hire date through to the pay period end date.
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References
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