June 25, 2019

To Pay Overtime or Not to Pay Overtime… That is the Question

The majority of city employees are considered “nonexempt” by the Fair Labor Standards Act (FLSA) and must be paid overtime if they work more than 40 hours during a seven-day workweek. The seven-day workweek should be defined within your city personnel policies. The FLSA salary test currently provides that any employee who earns less than $455 in gross wages per defined workweek (or $23,660 gross wages per year) is entitled to overtime pay, regardless of the employee’s employment position and duties.[1]

If an employee makes more than $455 gross wages per week you must then look at the categories of exemptions that are provided for within the FLSA and Kentucky law. These categories include executive, management, professional, administrative, computer and highly compensated employees. For more information on the specific requirements of these exemptions see the Department of Labor Fact Sheet #17A and 803 KAR 1:070(3).

It is also important to note that under Kentucky law, employers must be aware that these exemptions may not apply to manual laborers or other “blue collar” workers who perform work involving repetitive operations with their hands, physical skill, and energy or any first responders, even if these employees make more than $455 gross wages per week and fit into one of the exemptions. Kentucky law states that overtime must be paid to “manual laborers or other blue collar workers … police officers, detectives, deputy sheriffs, state troopers, highway patrol officers, parole or probation officers, park rangers, fire fighters, paramedics, emergency medical technicians, ambulance personnel, rescue workers, hazardous materials workers, and similar employees, regardless of rank or pay level, who perform work such as preventing, controlling, or extinguishing fires of any type; rescuing fire, crime, or accident victims; preventing or detecting crimes; conducting investigations or inspections for violations of law; performing surveillance; pursuing, restraining, and apprehending suspects; detaining or supervising suspected and convicted criminals, including those on probation or parole; interviewing witnesses; interrogating and fingerprinting suspects; preparing investigative reports; or other similar work…” To read the full text of this regulation see 803 KAR 1:070 or contact KLC Personnel Services.

Whether an employee should be receiving overtime is a fact-specific question based on the employee’s salary as well as specific job duties. Making the wrong determination can be very costly to cities; therefore, the city should consult with its city attorney in order to determine which city employees are exempt from overtime. In addition, KLC has an exempt v. nonexempt employee checklist that can assist with making these determinations.

For a copy of the checklist, questions on wage and hour issues or other personnel matters, contact Andrea Shindlebower Main, KLC’s Personnel Services Manager.

[1] The FLSA salary threshold is currently under review and may be modified in 2020. As always, KLC will notify you if any changes occur.