What is the FLSA duties test?

FLSA duties test definition and meaning

The FLSA duties test refers to the work an employee must perform in order to qualify for exemption under the Fair Labor Standards Act. This exemption excludes the employee from the FLSA’s minimum wage and overtime provisions. The United States Department of Labor oversees the FLSA and the administration of the job duties test.

More about the FLSA duties test and its purpose

The FLSA governs federal minimum wage, overtime, child labor, and recordkeeping standards for private-sector US employers. Employees subject to the FLSA’s minimum wage and overtime requirements are classified as “nonexempt,” while those who are excluded from these provisions are referred to as “exempt” or “white-collar employees.”

The FLSA duties test is one of the thresholds that employers must use to determine whether an employee qualifies as exempt under the Act. Another threshold is the salary basis test, but this test only applies to specific types of jobs.

This means that to qualify as exempt, an employee must satisfy the requirements of the FLSA’s job duties test and, where applicable, earn no less than the minimum salary requirement. If an employee doesn’t meet these criteria, they are classified as nonexempt, making them eligible for minimum wage and overtime pay.

Exempt employee categories

The FLSA provides an exemption from minimum wage and overtime pay requirements for employees in the following categories:

• Executive
• Administrative
• Professional
• Computer
• Outside sales

What the FLSA duties test requires

Executive employee exemption

• The employee’s primary job duty must be managing the company or a customarily recognized department within it.
• The employee must regularly direct the work of two or more full-time employees.
• The employee must have the authority to hire or terminate other employees, or their suggestions regarding such matters must be given significant consideration.
• The employee must receive a salary of at least $684 per week.

Administrative employee exemption

• The employee’s primary job duty must involve performing office or non-manual work directly related to management or general business operations, or serving customers.
• The employee’s primary responsibilities must include exercising discretion and independent judgment regarding significant matters.
• The employee must receive a salary or fee of at least $684 per week.

Professional employee exemption

This category consists of two sections: learned professionals and creative professionals.

Learned professionals

• The employee’s primary job duty must involve work requiring advanced knowledge, as defined by the FLSA, in a field of science or learning.
• This advanced knowledge must be acquired through prolonged specialized intellectual instruction.
• The employee must earn at least $684 per week on a salary or fee basis.

Creative professionals

• The employee’s primary job duty must involve work requiring imagination, invention, originality, or talent in a recognized artistic or creative field.
• The employee must earn at least $684 per week on a salary or fee basis.

Computer employee exemption

• The employee must work as a skilled professional in the computer field, such as a computer programmer, systems analyst, or software engineer.
• The employee must perform the primary duties outlined in the FLSA, including tasks related to the analysis, design, development, documentation, creation, and testing of computer systems or programs.
• The employee must earn at least $684 per week on a salary or fee basis, or receive an hourly wage of at least $27.63.

Outside sales employee exemption

• The employee’s primary job duty must be making sales, securing orders or contracts for services or use of facilities, or fulfilling other objectives as defined by the FLSA.
• The employee must customarily and regularly work away from the employer’s place of business.
• There is no salary or wage requirement for this exemption. Employers only need to adhere to the FLSA’s job duties test when determining exempt status for outside sales employees.

A note about highly compensated employees

An employee qualifies as highly compensated and is exempt if they:

• Earn $107,432 or more per year, which includes a salary or fee of at least $684 per week.
• Customarily and regularly perform at least one of the duties listed in the exempt executive, administrative, or professional employee categories.

What employers should know about the FLSA duties test

Employers need to take the following steps when navigating the duties test:

• Assess whether the business falls under FLSA coverage (most US businesses do).
• Ensure that the employee performs the necessary FLSA job duties and, if applicable, earns at least the minimum salary requirement.
• Avoid paying overtime to exempt employees who work more than 40 hours in a week, although offering additional compensation, such as bonuses or flat sums, is permitted.
• Review state law for any overtime exemption requirements, since states might have their own job duties tests. If both FLSA and state law apply, the employer should adhere to the law that is most favorable to the employee.
• Know that if an employee stops performing the mandated FLSA job duties but still meets the minimum salary requirement, they will lose their exempt status and become nonexempt. They must meet both thresholds, except if performing outside sales work (which doesn’t have a minimum salary requirement).
• Understand that exempt status is determined by job duties, not job titles.

Terms related to: FLSA duties test

• Employee
• Exempt employee
• Employer
• Bonus Pay

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