What is a Non-Exempt Employee?

Non-Exempt Employees are workers who are entitled to earn the federal minimum wage for each hour they work.

These workers are also entitled to overtime pay, calculated by multiplying 1.5 times their hourly rate, for each additional hour they work in a standard 40-hour workweek. These regulations are created by the Federal Fair Labor Standards Act (FLSA or Fair Labor Standards Act).

What does non-exempt or Non-Exempt mean?

“Non-Exempt” is a term that refers to employees who earn less than $455 per week. The superiors who handle the workflow should be directly supervising these workers.

Non-exempt employees are expected to carry out your orders, without interfering with your own management decisions. For this reason, non-exempt employees tend to dominate job sectors such as construction, maintenance, and other jobs that involve physical labor or performing repetitive tasks. Assembly line workers are a perfect example of a Non-Exempt Employee..

Non-Exempt Employee: Distinctions and Qualifications

The Non-Exempt Employee are typically paid an hourly wage. TO unlike exempt employees, who typically earn significantly higher fixed wages. However, while non-exempt workers must receive overtime pay of 1.5 times their hourly rate, for all hours worked beyond a 40-hour workweek, exempt employees are not legally entitled to collect overtime payeven if your workweeks are well in excess of 40 hours.

If you are a Non-Exempt Employee, you are entitled to overtime when you work more than your 40-hour workweek.

Under the Fair Labor Standards Act, workers may be considered non-exempt if they earn less than the $455 weekly minimum or have limited scope for self-monitoring.


A maintenance worker is hired to work 35 hours a week at $15 an hour. With a weekly earnings of $525, he easily passes the wage test to be designated as an exempt worker, as his weekly earnings exceed the $455 limit. But this worker is also directly supervised and therefore has little opportunity for independent judgement. Therefore, he is ultimately classified as a non-exempt employee. If this employee works 50 hours in a single week, he would earn his regular rate of $15 per hour for 40 hours. But he would earn $22.50 for each of the 10 hours of overtime.

Under the FHSA (Federal Hazardous Substances Act), non-exempt workers must earn the federal hourly minimum wage of $7.25, however, many states and some municipalities impose higher minimum wages than the federal minimum wage. In these cases, the higher minimum wage overrides the federal rate.

Non-Exempt Employee: Advantages and Disadvantages

The fact that it is preferable to be a Non-Exempt Employee versus an exempt one depends largely on the priority that the individual has regarding the balance between work and private life.

Even if exempt salaried employees typically earn much more money than non-exempt salaried employees, the first group may not enjoy additional compensation for working long hours, while the second group earns more money for working overtime. In contrast, an exempt worker may be able to occasionally sneak off work early, and still collect full pay. Exempt workers are also more likely to receive benefits such as paid time off, health coverage, and participation in retirement plans.

It is interesting that Both Non-Exempt and Exempt Employees have the same right to receive government employment benefits. One example: Both categories of workers qualify for Social Security benefits once they retire. Both may also be eligible to receive weekly unemployment payments, should they lose their jobs.

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