Myths About Wages

There are two categories of employees: exempt employees and non-exempt employees. If an employee is exempt under federal or Minnesota’s wage and hour laws that means that employees are exempt from overtime and minimum wage requirements. An employee who is non-exempt under federal and Minnesota’s wage and hour laws means that an employer has to pay that employer overtime and must follow minimum wage requirements.

Myth #1: Sue’s Drycleaning, Inc. pays her employees a salary rather than hourly, and therefore the company believes they are exempt from paying overtime.

The fact that an employee is paid a salary does not make them exempt from either overtime laws or minimum wage laws. In order for an employee to be exempt from overtime laws, they must meet a “duties test” under the applicable law and be paid a minimum salary under the specific law that applies to the “duties test” that they meet.

Myth #2: John’s Snowblowing, LLC orally tells employees that they are an exempt employee under the law.

If your employee is exempt, you must provide them notice in writing, including the basis for designating them as exempt.

Myth #3: Susan’s Silly Songs, LLC requires employees to work 48-hour weeks because overtime in Minnesota is based on a 48-hour week. The company’s employees engage in interstate commerce.

Federal law requires overtime to be paid to employees who work in excess of 40-hours per workweek. Employers who are subject to the federal Fair Labor Standards Act includes employers involved in interstate commerce; whose gross annual sales are more than $500,000; and hospitals and nursing homes, personal care assistance (PCA) and community first services and supports (CFSS) agencies, private and public school, federal, state and local government agencies; and other categories.

Myth #4: Jim’s Piano Bar, LLC changes its workweek to make sure that the workweek is defined so that the hours its employees work do not exceed 48 hours per workweek. Thus, the company believes it does not have to pay overtime to its employees.

Under Minnesota law, a workweek is defined as “a fixed and regularly recurring period of 158 hours, seven consecutive 24-hour periods.” Once a workweek is established, it remains fixed. Furthermore, while the law allows a workweek to be changed, the changed must be “permanent rather than an evasion of the overtime provisions.”

Myth #5: Caring For You, Inc. reduces their employee’s compensation for time taken to express milk.

Employers are prohibited in Minnesota from reducing an employee’s compensation for time taken to express milk or to require an employee to make up time to express milk.

Myth #6: Luminating Lights, LLC, provides its employees 180 hours of PTO without an express amount of that time carved out for Earned Sick and Safe Time (ESST) and without a separate ESST policy that allows for ESST. The LLC requires employees to obtain permission to take PTO.

The employes must have a separate ESST policy or carve out ESST and set the ESST policy within the PTO policy. Under this fact pattern, the employer must allow the employee to use all 180 hours for ESST and follow the ESST law in implementing PTO.

Spangler and de Stefano, PLLP advises business owners about wage and hour laws.

The material contained herein is for informational purposes only, and is not intended to create or constitute an attorney-client relationship between Spangler and de Stefano, PLLP and the reader. The information contained herein is not offered as legal advice and should not be construed as legal advice.