Welcome back to the Employee Survival Guide. It's Mark Carey. I have a question for you. When you stay late at the office, let's say it's 7 p.m. on a Tuesday, and you're finishing up that report, are you being paid for that time? Most of you listening will say, no, I'm on salary. I don't get overtime. And I'm here to tell you, you might be wrong. There's a massive misconception in the American workplace that the word salary is a magic wand that waves away your right to overtime pay. It isn't. In fact, misclassification of employees as exempt is one of the most common forms of wage theft in the country. Today is in just six minutes we are going to audit your job. We're going to find out if your manager manager title is fake, if your salary is legal, and if you are actually an hourly employee in disguise who is owed a lot of back pay. Let's get into it. First, let's kill the myth. Salaried and exempt are not the same thing. Salaried is just a payment method. It means you get the same paycheck every two weeks. Exempt is a legal status under the Fair Labor Standards Act. It means you are exempt from the law that requires overtime pay. Unless you are legally exempt, you are non-exempt. And if you are non-exempt, I don't care if you make a million dollars a year or have a PhD, if you work 41 hours, you get paid for 41 hours. So how does your boss prove you are exempt? They have to pass three tests. Not one, not two, all three. Number one, the salary basis test. They have to pay you a guaranteed salary that doesn't get docked because you left an hour early for the dentist. If they dock your pay based on hours work, you're you are an you aren't an exempt employee. You are hourly. Test number two, the salary level test. This is the one that catches everyone. You have to be paid enough. Back in 2024 and 25, the Department of Labor significantly raised these limits. As of January 1st, 2025, the threshold jumped to$1,128 per week. That's$58,656 per year. Here is the math. If you are making$50,000 a year or$55,000 a year, and you are not in a special category like outside sales or teaching, you are likely eligible for overtime right now. It doesn't matter what your job description says. The money isn't there. Here's the duties trap. But let's say you make$65,000. You pass the money tests. You have to pass the test number three, the duties test. This is where companies get sneaky. This is where they give you a fancy title to avoid paying you for your time. There are three main categories employers use to hide the executive exemption. To pass this, your primary duty must be managing the business. But here is the kicker. You must customarily direct the work of at least two full-time employees, and you must have the authority to hire or fire, or your opinion must carry significant weight in the office. The trap, if your title is assistant manager, but you spend 90% of your time stocking shelves, making coffee or running the register, you can't fire anyone. You're likely misclassified. You are a worker bee with a manager's badge, and you are owed overtime. The administrative exemption, this is the office worker trap. To be exempt, your work must involve the exercise of discretion and independent judgment with respect to matters of significance. That's actually what the statute says. The trap, if you just follow a manual, or if you have to ask your boss for permission for every single decision, or you're just doing data entry, this is not independent judgment. You are non-exempt. The third category, the learned professional. This is for doctors, lawyers, and engineers. The trap. Having a master's degree doesn't make you exempt if the job doesn't require it. If you have a master's in history but you're working on a as a generic receptionist, you get overtime. And then the shadow hours. Why does this all matter? Because of what I call the shadow hours. If you are misclassified, you aren't losing money on the extra hour you've just stayed late. You are losing money on the shadow hours, the work you do that isn't tracked. Since the rise of remote work, the ill the the lines were have been blurred. Checking Slack at 8 p.m., that's work. Answering a client email Sunday morning, that is also work. Traveling to a conference during the day, that's work. If you are legally non-exempt, your employer must pay you for all hours you are suffered to be permitted to work. That's actually a phrase out of the statute. Even if you didn't ask to do the work, if they knew you did it and accepted the work, they have to pay for it. If you earn thirty dollars an hour, roughly$62,000 a year, your overtime rate is$45 an hour. If you work just five hours of overtime a week, one hour a day, that's$225 a week. That is nearly$12,000 a year. You are donating to your boss for free. So what do you do if you think you're in that trap? Don't storm this into the CEO's office today. You need to build your case. Step one, get your original offer letter and your current job description. Step two, look at your pay stub. Are you under the 58656 threshold of pay? If yes, that's a red alert. Step three, start a shadow log for two weeks. Track every single minute you work when you are when you're left, every email you sent from home. Step four, compare your actual duties to the legal requirements I just listed. Are you a manager who manages no one? Are you an administrator who makes no decisions? If the math doesn't add up, you have options. You can talk to HR, or you can file a claim with the Department of Labor, wage an hour division in your state and the federal government. You can go back two years, sometimes three, to reclaim unpaid wages. Remember, a title is cheap. Your time is expensive. Don't let them pay you without the title when they owe you a check. Have a great week. Thank you for listening, and allow me to be of service once again.