FLSA Exempt vs Non-Exempt
$684/wk
Salary Floor
$35,568/yr threshold (post-2024 vacatur)
3
Main Tests
Executive, Administrative, Professional
1.5×
OT Multiplier
Time and a half over 40
two gates, three duties tests
The Exemption Decision Tree
Walk every classification through both gates. If either fails, the employee is non-exempt and overtime applies.
gate 1 · salary basis
Paid at least $684/week on salary basis?
no →
Non-exempt. Overtime applies. Stop here.
yes ↓
Continue to Gate 2.
gate 2 · duties test
Primary duty matches one of these?
Executive
Manages 2+. Hires/fires (or recommendations carry weight).
Administrative
Office or non-manual work. Discretion on matters of significance.
Learned Professional
Advanced knowledge from prolonged specialized study.
Creative Professional
Invention, imagination, originality, or talent.
Computer Employee
$684/wk OR $27.63/hr. Specific tech duties.
Outside Sales
Sales away from employer's place of business. No salary minimum.
both gates passed
EXEMPT
No overtime. Salary covers all hours.
either gate failed
NON-EXEMPT
1.5× over 40 in a workweek.
The 2024 Threshold Saga
DOL announced increases to $844/week (July 2024) and $1,128/week (January 2025). A federal court vacated those increases nationwide in November 2024. As of 2026, threshold is back to $684/week. Verify the current rule before exam day — this is the single most volatile FLSA number.
Exam Traps
Job title does NOT control
A "manager" who spends most time doing the same work as subordinates may not qualify as Executive. Duties drive classification, not the title on the door.
Salary basis means full salary every week worked
Improper deductions for partial-day absences can destroy the exemption for the entire week.
Non-exempt cannot waive overtime
Even if the employee agrees in writing to straight time over 40, the employer still owes 1.5x. The right cannot be contracted away.
Comp time is PUBLIC sector only
Private-sector non-exempt employees cannot be paid in compensatory time off. They get cash overtime. The exam tests this distinction.
Two stamps required
Salary basis AND duties test. Either one missing = non-exempt = overtime owed. No matter how high the title.
Duties beat titles
Routine clerical or production work even at high pay = non-exempt. The actual day is what counts.
Everyone wants past the rope (collect overtime). By default, everyone is in the line (non-exempt) and qualifies for overtime.
To get past the rope, you need a special pass — exempt status. The pass requires two stamps.
You must be paid at least $684 per week on a salary basis.
Your real day-to-day work has to match Executive, Administrative, Professional, Computer, Outside Sales, or Highly Compensated.
Either stamp missing and you stay in the overtime line, no matter what your title says.
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