Exempt vs. Non-Exempt Employees in NYC: Are You Classified Correctly or Missing Out?

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New York City workers breathe life into our vibrant city every single day. But have you ever wondered if you’re being paid what you’re genuinely worth? Do you feel like your job position should come with more benefits, safety nets, and rights?

You could be right – and you could be missing out based on your employee classification. Both federal and local labor laws set different classifications for “exempt” and “non-exempt” employees. While these terms might look like jargon in your employment contract, they can profoundly impact your paycheck, hours, benefits, savings, and overall work-life balance.

What Are the Exempt Employees Rules in NYC?

In employment terms, being “exempt” means that certain labor laws do not apply to you, most notably those involving overtime pay. While these rules are generally set by federal standards, New York City has its own specific laws because of its unique employment landscape.

To qualify as an exempt employee in New York City:

  1. You must earn at least a minimum salary, which can change year over year similar to how minimum wage laws adjust to reflect inflation and NYC’s cost of living.
  2. Your primary responsibilities must be centered on executive, administrative, or specialized professional tasks as defined by New York’s labor standards.
  3. No matter how many hours you put into your job each week, you must consistently receive your full weekly designated salary.

What Does It Mean to Be an Exempt Employee in New York?

If you’re classified as an exempt employee in the Big Apple, that means you don’t get benefits like overtime pay. It also means you don’t get paid on an hourly basis with all of the required rest and meal breaks. While this arrangement may sound less than ideal, many workers enjoy the autonomy and flexibility they get when they don’t have to clock in and out.

Although this freedom allows exempt employees to manage their own hours, there is a catch – you could end up working more than 40 hours in a week without any extra overtime pay.

What’s the Difference Between a Non-Exempt and Exempt Employee in New York City?

The difference between an exempt versus a non-exempt classification can change your daily experience at your job. It also changes the math for your employer.

  • Exempt employees are usually salaried professionals who don’t get overtime pay.
  • Non-exempt employees are paid hourly, have mandatory paid breaks, and get overtime pay at a higher rate for any time they work beyond the standard 40-hour workweek.

If your company is trying to cut corners or not acting in good faith, management might try to save money on payroll by misclassifying non-exempt employees as exempt. As a result, employees who should be getting paid overtime don’t get those wages. This is wage theft.

Factors That Determine Exempt vs Non-Exempt Employee Status

Employee classification isn’t always black and white. The law goes into the various factors that determine whether you should be classified as exempt or non-exempt, such as:

  • Pay Rate – Do you get paid by the hour or on a weekly salary? Hourly employees are more likely to be non-exempt, while salaried employees tend to be exempt.
  • Job Duties– Simply having a high-profile job title doesn’t necessarily make you exempt. The nature of your actual day-to-day job duties determines your status.
  • Supervision – Exempt roles usually get more autonomy and may involve overseeing other employees or playing a significant part in shaping business operations.

While the classification process may sound complicated if you’re unfamiliar with the concept, the law also includes examples of the types of roles that tend to be exempt.

Examples of Exempt Employees in New York City

The following job roles typically fall under the exempt category in NYC:

  • Executive Roles, such as managers who supervise at least two full-time employees and hold sway in decisions involving hiring, firing, and promotions.
  • Administrative Roles, such as personnel who execute office tasks directly related to management or general business operations, often with decision-making discretion.
  • Learned Professional Roles, including positions that need extended or specialized education such as lawyers, physicians, and certified accountants.
  • Creative Professional Roles, such as artists, writers, musicians, and other professionals whose work involves originality, imagination, or talent in an artistic domain.
  • Outside Sales Roles, involving employees engaged primarily in sales activities beyond the company’s primary place of business, such as field sales representatives.

Other types of roles, including restaurant and hospitality work, often fall under the non-exempt category. Many employees who work for tips are also often classified as non-exempt.

Do Exempt Employees Get Overtime in New York?

The short answer is no. In New York City, exempt employees do not have a claim on overtime pay, even if their workweek stretches beyond the traditional 40 hours on a regular basis.

That’s why this distinction is so important. In New York, overtime rates must be paid at 150% of your regular hourly rate. If your employer has misclassified you, you could be losing thousands of dollars every week on overtime pay that should be part of your wages.

Can You Be Misclassified as Exempt?

Unfortunately, yes. Classification errors can happen. Sometimes they can be an innocent oversight, but sometimes employers may deliberately misclassify you to sidestep overtime payments. This is illegal wage theft and you have the right to file a claim for your full wages.

If you suspect that your employer may have misclassified you, learning about these classifications is the first step to getting your employment situation back on the right track.

Talking to an employment attorney can help you move forward and navigate the intricacies of New York City’s labor laws. An experienced employment classification lawyer can help you recoup any unpaid wages or benefits and make sure you don’t get short-changed.

Understanding your employee status, staying informed about your rights, and keeping vigilant can make a huge difference in your professional journey. If there’s even a shadow of a doubt that you might be missing out on your rights because of misclassification, the right legal counsel can help protect your paycheck and your dreams. At Mirza Law, we can help. Contact us now.