Exempt vs Non-Exempt

HELP! I have come into this organization as their 1st HR Manager, and the company has been in business over 50 years. The first item I have identified as a problem (also illegal) is the mis-classification of employees as exempt. Everyone is classified as exempt, is not paid overtime, and is given comp time if and when they work over 40 hours in a week (we are a private company). So, you see my problem? Now, I am putting together a recommendation as to who needs to be re-classified and eligible for overtime pay. In all my years as an HR Manager, I still have a difficult time with the Administrative Exemption description. I think it is so broad that you could almost put all employees in this classification. Where do the rest of you draw the line? Second problem: has anyone taken employees from exempt to non-exempt? Were they offended? How was it presented to them? Any suggestions will be appreciated.

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