Is it legal for a company to keep switching your pay status when you job duties and responsibilities have not changed?

When I was hired at my current company I was hired as a salary non-exempt, meaning anything above 40 hours I received overtime. As of the 1st of this month, I was switched to straight hourly which I fully expected. I was notified today that they now plan to switch my status to salary. I am assuming they are doing this to get out of paying me for the additional 16 hours that I am entitled to or this pay period. Is it legal for them to do this again? My job duties and responsibilities have not changed and I don’t know if I have a leg to stand on.

Asked on July 23, 2012 under Employment Labor Law, New Mexico


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

If you don't have an employment contract which specifies your amount or form of compensation, your employer may change how you are paid at will. However, they cannot arbitrarily make you exempt from overtime unless you meet  the criteria for exemption; if you do not, you must be paid overtime. Also, any changes are prospective, or forward looking, only, not retroactive; i.e., if you worked, say, 56 hours one week as a non-exempt hourly employee, you must be paid your overtime, even if going foward you are legitimately changed to an exempt salaried basis.

To be exempt, you must be paid on a salary basis and your job duties and responsibilities must also meet one or more of the exemptions. These exemptions can be found on the Department of Labor website. The main ones are the executive (which should be called "managerial," since it applies to non-executive managers), administrative, and professional exemptions. You should look those up and compare to your job to see if you could be made exempt. If you don't meet one or more of those exemptions, then even if paid on a salary basis, you are owed overtime when working more than 40 hours in a week.

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