Work more than 40 hours in a week as a nonexempt employee, and federal law says every extra hour must be paid at time and a half. Work those same hours as an exempt employee, and the law says your employer owes you nothing extra. One word on your HR paperwork controls whether your 50-hour weeks generate 10 hours of premium pay or zero, and a surprising number of workers have never checked whether their word is the right one.
The rules come from the Fair Labor Standards Act, and the U.S. Department of Labor’s overtime pages lay out the framework. The default under the FLSA is that you are owed overtime. Exemption is the exception, the employer bears the burden of proving it applies, and the tests are more demanding than most job offers let on.
The default: overtime for hours past 40
For nonexempt workers, the math is straightforward: hours worked beyond 40 in a single workweek must be paid at no less than one and a half times your regular rate. The workweek is a fixed, recurring 168-hour period, and averaging across two weeks is not allowed. An employer cannot make overtime disappear by paying a salary, either. Salaried nonexempt employees exist, and they are owed overtime too; the salary simply gets converted to an hourly rate for the calculation. There is also no federal cap on how many hours an adult can be asked to work, so the overtime premium is the FLSA’s main lever, making long hours expensive rather than forbidding them.
The three-part test for exemption
The most common exemptions, the so-called white-collar exemptions for executive, administrative, and professional employees, require passing all three of these tests, described in the department’s Fact Sheet 17A:
First, the salary basis test: you must be paid a predetermined salary that does not go up and down with the quality or quantity of your work. Second, the salary level test: that salary must meet the minimum set by regulation. Third, the duties test: your actual job duties must primarily involve exempt work, such as managing two or more employees with hiring input (executive), exercising independent judgment on significant business matters (administrative), or performing work requiring advanced knowledge in a field of science or learning (professional).
Fail any one of the three, and you are nonexempt, no matter what the offer letter says.
Where the salary line sits now
The enforced federal salary floor is $684 per week, which works out to $35,568 a year. A 2024 rule would have raised that level substantially in two steps, but a federal court struck the rule down in November 2024, which returned the threshold to the prior figure. So in 2026, a salaried employee earning less than $684 a week is entitled to overtime regardless of duties, full stop. Above that line, the duties test decides. A separate, streamlined exemption exists for certain highly compensated employees at a much higher annual threshold, but it still requires some exempt duties, and it is rare enough that most workers never encounter it.
Duties, not titles, decide
This is the part employers get wrong most often, sometimes innocently and sometimes not. Calling someone an assistant manager, a coordinator, or an analyst does not make them exempt. What counts is what fills the majority of the workday. A shift supervisor who spends most hours running a register alongside the crew is likely nonexempt despite the title. Inside sales staff, help desk technicians, and bookkeepers frequently fail the duties tests even at healthy salaries. On the flip side, outside salespeople have their own exemption with no salary requirement at all, and certain computer professionals can be exempt if paid at least $684 weekly on salary or at least $27.63 an hour.
State law can be more generous
The FLSA is a floor, not a ceiling. Several states set higher salary thresholds for exemption, apply stricter duties tests, or require daily overtime after eight hours in a day rather than only after 40 in a week. Whichever law is more protective of the worker is the one that applies to you. If you work in a state with its own overtime statute, check your state labor department’s rules before concluding you are properly classified under the federal test alone.
If you think you are misclassified
Start with the evidence: keep your own record of hours worked, since misclassified employees rarely have official time records. Then compare your real duties, not your title, against the fact sheets for each exemption. If it does not add up, you can raise it internally or file a confidential complaint with the Wage and Hour Division through its complaint process. Back wages can generally be recovered for two years, or three if the violation was willful, and the law forbids retaliation for asserting your rights. For a full-time worker averaging 50-hour weeks, two years of unpaid time and a half is real money, which is exactly why this one word on your paperwork deserves a hard look.
