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In last month’s update, we reviewed the duties test for the Administrative exemption and will now be moving on to the Professional exemption [the current Fact Sheet still reflects the OLD salary threshold; disregard it and focus on the other elements of the exemption test]. The updated overtime provisions include a new salary threshold of $47,476, but the duties tests have remained unchanged, so when analyzing a job to determine if the position is exempt from overtime, you must also ensure that the duties tests are met in addition to the new salary threshold. There are two categories under the Professional exemption: learned professional and creative professional. To meet the requirements of the learned professional exemption job duties, ALL of the following tests must be met:
  • The employee must be compensated on a salary basis [no less than the new minimum]
  • 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; and
  • The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.
To meet the requirements of the creative professional exemption job duties, ALL of the following tests must be met:
  • The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $913 per week;
  • The employee’s primary duty must be the performance of work requiring invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.
The job must meet ALL of these requirements…not just some.  The US Department of Labor is very aggressive at enforcing this…and assesses significant penalties, especially if an employer willfully misclassifies employees as exempt from overtime. For complete details on this exemption and to learn more about other exemptions, visit the Wage and Hour division of the US Department of Labor. Do you need assistance with this or other compensation consulting needs? Contact us and check out our blog for more helpful resources.