Robert W Ditmer Financial Support

Salary Alternatives for Non-Exempt Employees*

 

Time-and-a-half is a term that we have to work with, but a term that is still often misunderstood. All payroll professionals are familiar with the basic requirement of the Fair Labor Standards Act (FLSA) to pay overtime in certain circumstances. However, the application of the principle is all too often difficult to grasp.

Some of the biggest problems payroll professionals face when confronted with the issues of overtime are the costs associated with the payment of overtime, the costs of administering the payroll system, as well as the potential costs if the employer fails to comply with the laws, both on a federal and state level. Paying an employee a salary often results in cost savings by cutting the administrative costs associated with issuing a paycheck. But there are also salary strategies that can actually reduce wage costs.

 

The following five-part series discusses salary alternatives for non-exempt employees in the context of how employers can pay employees a salary and still conform to the regulations regarding overtime pay. The information in this series of articles was prepared in collaboration of the legal department of the American Payroll Association.

 

• The Basics of Calculating Overtime Pay

• Calculating Salaries for Non-Exempt Employees

• The Fluctuating Workweek Method

• 'Belo' Plans

• Other Salary Alternatives? Conclusion.

 

*The information in this set of articles was first published as a series of four articles in PAYTECH, the Official Publication of the American Payroll Association, between February and May 2003.