![]() For example, most railroad worker employees are governed under the Railway Labor Act. However, as a general rule, any job governed by a different federal labor law would likely be excluded from FLSA requirements. The majority of jobs in the United States fall under the FLSA’s purview, although there are a few exceptions including movie theater employees, agricultural workers and others who are excluded from FLSA overtime rules. It does not matter if that income is earned on an hourly basis or a salaried basis. All compensation is considered to be “earned income” and is therefore taxable to whatever tax bracket their compensation falls in. There is absolutely no difference in how exempt and non-exempt employees are taxed aside from the various tax brackets into which all employees fall within. Each may have their own pay requirements under the FLSA or state law. There are several other classifications of employees in addition to exempt and non-exempt including trainees, interns, temporary workers, and volunteers. Employees are classified as either exempt or non-exempt pursuant to the type of work they perform and the salary (or wages) they earn. ![]() Non-exempt employees are eligible to receive overtime pay, which differs depending upon state law. Exempt employees are just that – exempt from overtime pay. The most significant difference between the two is payment for overtime worked over a period of time. Under the Fair Labor Standards Act (FLSA), there are two types of employees – exempt and non-exempt. What’s the Difference between an Exempt and a Non-Exempt Employee? Here is everything you need to know about non-exempt employees – from pay issues to the types of duties and responsibilities related to each.
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