Both federal law (Fair Labor Standards Act or FLSA) and state law (New York Minimum Wage Act and applicable regulations) generally require the payment of overtime wages for work performed after 40 hours per week. The FLSA and the State Minimum Wage Act exempt employees who work in a bona fide executive capacity from the overtime pay requirements.
If the criteria of the New York State exception match those in the FLSA, this Department usually applies the criteria consistently with the FLSA, its regulations, and interpretations issued by the U.S. Department of Labor.
To qualify for the Executive employee exception, an individual must meet all of the following tests:
 The Employee’s primary duty consists of the management of the enterprise
 The Employee customarily and regularly directs the work of two or more other employees
 The Employee has the authority to hire or fire other employees
 The Employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion, or any other change of status of other employees have particular weight
 The Employee customarily and regularly exercises discretionary powers
 The Employee is paid on a salary basis of not less than $543.75 per week inclusive of board, lodging, or other allowances
What does “salary” mean?
Being paid on a “salary basis” means an employee regularly receives a predetermined amount of compensation each pay period on a weekly, or less frequent, basis. The predetermined amount cannot be reduced because of variations in the quality or quantity of the employee’s work. An exempt employee must receive the full salary for any week in which the employee performs any work, regardless of the number of days or hours worked.
What does “primary duty” mean?
"Primary duty" has been interpreted to mean the principal, main, major, or most important duty that the employee performs. A determination of an employee's primary duty must be based on all the facts in a particular case, with the major emphasis on the character of the employee's job as a whole.
Additionally, for the purposes of the Hospitality and Building Service industries, the Department generally views an activity that constitutes 20 percent of an employee’s duties as being a primary duty.
What are “discretionary powers?”
Discretionary powers involve the exercise of discretion and independent judgment. In general, the exercise of discretion and judgment involves:
 The comparison and evaluation of possible courses of conduct
 Acting or making a decision after considering the possibilities
The term must be applied in the light of all the facts involved in the employee’s employment situation. It implies that the employee has authority to make an independent choice, free from immediate direction or supervision. Factors to consider include (but are not limited to):
• Does the employee formulate, affect, interpret, or implement policies or practices?
• Does the employee carry out major assignments in conducting the business?
• Does the employee’s work affect business operations to a substantial degree?
• Can the employee commit the employer in matters that have significant financial impact?
• Does the employee have authority to waive or deviate from established policies and procedures without prior approval?
If an employee’s decisions are revised or reversed after review, it does not mean that the employee is not exercising discretion and independent judgment. The exercise of discretion and independent judgment must be more than the use of skill in applying well-established techniques, procedures or specific standards described in manuals or other sources.
What does “customarily and regularly” mean?
The phrase “customarily and regularly” means more than occasional but less than constant. It includes work normally done every workweek, but does not include isolated or one-time tasks.
What does “two or more” mean?
The phrase “two or more other employees” means two full-time employees or their equivalent. For example, one full-time and two half-time employees are equivalent to two full-time employees. The supervision can be distributed among two, three, or more employees, but each employee who is seeking to be treated as an executive must customarily and regularly direct the work of two or more other full-time employees or the equivalent. For example, a department with five full-time nonexempt workers may have up to two exempt supervisors if each supervisor directs the work of two of those workers.
What does “particular weight” mean?
Factors to consider in determining whether an employee’s recommendations are given “particular weight” as to hiring, firing, advancement, promotion, or any other change of status include (but are not limited to):
 Whether it is part of the employee’s job duties to make such recommendations
 How often such recommendations are made, requested, and relied upon
Generally, an executive’s recommendations must pertain to employees whom the executive customarily and regularly directs. It does not include occasional suggestions.
An employee’s recommendations may still be deemed to have “particular weight” even if:
 A higher level manager’s recommendation has more importance
 the employee does not have authority to make the ultimate decision as to the employee’s change in status
What is the “management of the enterprise”?
Generally, “management” includes, but is not limited to, activities such as:
 Interviewing, selecting, and/or training employees
 Setting and adjusting pay and schedules;
 Directing the work of employees
 Maintaining production or sales records for use in supervision or control
 Appraising employees’ productivity and efficiency for the purpose of recommending promotions or other changes in status
 Handling employee complaints and grievances
 Disciplining employees
 Planning the work
 Apportioning the work among the employees
 Determining the type of materials, supplies, machinery, equipment or tools to be used or merchandise to be bought, stocked, and sold
 Controlling the flow and distribution of materials or merchandise and supplies
 Providing for the safety and security of the employees or the property
 Planning and controlling the budget;
 Monitoring or implementing legal compliance measures   

Wage and Hour Division (WHD)

Compliance Assistance - Fair Labor Standards Act (FLSA)

Overview

The FLSA establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and in Federal, State, and local governments. Covered nonexempt workers are entitled to a minimum wage of not less than $7.25 per hour effective July 24, 2009. Overtime pay at a rate not less than one and one-half times the regular rate of pay is required after 40 hours of work in a workweek.

       FLSA Minimum Wage: The federal minimum wage is $7.25 per hour effective July 24, 2009. Many states also have minimum wage laws. In cases where an employee is subject to both state and federal minimum wage laws, the employee is entitled to the higher minimum wage.

       FLSA Overtime: Covered nonexempt employees must receive overtime pay for hours worked over 40 per workweek (any fixed and regularly recurring period of 168 hours — seven consecutive 24-hour periods) at a rate not less than one and one-half times the regular rate of pay. There is no limit on the number of hours employees 16 years or older may work in any workweek. The FLSA does not require overtime pay for work on weekends, holidays, or regular days of rest, unless overtime is worked on such days.

       Hours Worked (PDF): Hours worked ordinarily include all the time during which an employee is required to be on the employer’s premises, on duty, or at a prescribed workplace.

       Recordkeeping (PDF): Employers must display an official poster outlining the requirements of the FLSA. Employers must also keep employee time and pay records.

       Child Labor: These provisions are designed to protect the educational opportunities of minors and prohibit their employment in jobs and under conditions detrimental to their health or well-being.

Wage and Hour Division (WHD)

Handy Reference Guide to the Fair Labor Standards Act

(For best printout, see the PDF version.)
Revised September 2010

The Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in Federal, State, and local governments.

The Wage and Hour Division (WHD) of the U.S. Department of Labor (DOL) administers and enforces the FLSA with respect to private employment, State and local government employment, and Federal employees of the Library of Congress, U.S. Postal Service, Postal Rate Commission, and the Tennessee Valley Authority. The FLSA is enforced by the U.S. Office of Personnel Management for employees of other Executive Branch agencies, and by the U.S. Congress for covered employees of the Legislative Branch.

Special rules apply to State and local government employment involving fire protection and law enforcement activities, volunteer services, and compensatory time off instead of cash overtime pay.

Basic Wage Standards

Covered, nonexempt workers are entitled to a minimum wage of $7.25 per hour effective July 24, 2009. Special provisions apply to workers in American Samoa and the Commonwealth of the Northern Mariana Islands. Nonexempt workers must be paid overtime pay at a rate of not less than one and one-half times their regular rates of pay after 40 hours of work in a workweek.

Wages required by the FLSA are due on the regular payday for the pay period covered. Deductions made from wages for such items as cash or merchandise shortages, employer-required uniforms, and tools of the trade, are not legal to the extent that they reduce the wages of employees below the minimum rate required by the FLSA or reduce the amount of overtime pay due under the FLSA.

The FLSA contains some exemptions from these basic standards. Some apply to specific types of businesses; others apply to specific kinds of work.

While the FLSA does set basic minimum wage and overtime pay standards and regulates the employment of minors, there are a number of employment practices which the FLSA does not regulate.

For example, the FLSA does not require:

1.     vacation, holiday, severance, or sick pay;

2.     meal or rest periods, holidays off, or vacations;

3.     premium pay for weekend or holiday work;

4.     pay raises or fringe benefits; or

5.     a discharge notice, reason for discharge, or immediate payment of final wages to terminated employees.

The FLSA does not provide wage payment or collection procedures for an employee뭩 usual or promised wages or commissions in excess of those required by the FLSA. However, some States do have laws under which such claims (sometimes including fringe benefits) may be filed.

Also, the FLSA does not limit the number of hours in a day or days in a week an employee may be required or scheduled to work, including overtime hours, if the employee is at least 16 years old.

The above matters are for agreement between the employer and the employees or their authorized representatives.