*In honor of the Fair Labor Standard Act’s 78th birthday and the highly anticipated changes to the DOL overtime regulations, the Modern Workplace is running a special multipart series entitled “FLSA Fundamentals” which will cover the basics of this important law and culminate in a discussion of the final changes to the regulation upon their release. This is the third post in that series.*
Given the time-intensive and nuanced analysis involved in calculating hours worked by non-exempt employees, compensable and non-compensable working time, and the regular rate of pay, many employers leap at the opportunity to avoid this rigmarole by classifying employees as exempt. As the next few posts in the “FLSA Fundamentals” series will demonstrate, however, properly classifying employees as exempt can be just as harrowing as non-exempt employee requirements. Employers need to beware of misclassifying employees as exempt, because misclassification can lead to multi-claimant lawsuits, awards of substantial damages, and enormous legal defense costs.