Fixed Salary Laws in Texas
The Fair Labor Standards Act (FLSA) requires employers throughout the United States to pay employees a minimum wage and to compensate them for overtime hours. State laws must comply with the FLSA, although state requirements can exceed the federal government's requirements in this area. In Texas, employers must comply with minimum wage and overtime laws even if they pay employees a fixed salary rather than paying them hourly, unless the employees meet the state and federal criteria for exemptions to these laws.
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Not Necessarily Exempt
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Paying a worker a fixed salary does not necessarily exempt him from minimum wage and overtime laws. As of June 2011, workers in Texas must receive a minimum wage and be paid overtime if they work more than 40 hours per week unless they make more than $455 per week and work in an executive, administrative or professional capacity. Texas law also exempts employees who work in outside sales or in certain computer-related professions from minimum wage and overtime laws.
Pay Frequency
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Salaried employees must get paid at least twice a month. Employers may either pay these employees biweekly -- on a set day every other week, such as every other Friday -- or semimonthly, meaning their payday falls on different days, but they are paid at least twice per month. Employees who are exempt from minimum wage and overtime rules may be paid on a monthly basis.
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Irregular Hours
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Some employees earn a fixed amount each week even though they work varying number of hours, depending on the work they do for the company that week. For example, computer technicians may work 25 hours one week and 37 hours the next week, but still be paid the same amount. Texas law, as of June 2011, requires these workers to receive half-time overtime compensation instead of time and a half if they work more than 40 hours in one week.
Calculating Hourly Rate
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Employers in Texas must calculate salaried employees' regular hourly rate to determine how much overtime to pay them if they work more than 40 hours in a week. For most workers, employers can divide the worker's weekly salary by 40 to determine his regular hourly rate. If an employee usually works a non-standard number of hours, such as 37 or 36 hours, instead of 40 hours, divide the worker's salary by that number. For workers who work irregular hours, determine their rate each week by dividing their salary by the number of hours they worked that week. If you pay workers semimonthly or biweekly, multiply their salaries by the number of times they get paid per month and multiply that by 12 to determine their yearly salary amount. Divide that amount by 52 to determine their weekly salary.
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