Salaried and hourly employees can be treated differently in Iowa because of their different statuses. A salaried employee, for instance, may be exempt from overtime pay rates that apply to hourly employees. But salaried employees must meet certain work and pay requirements before they can be classified as exempt.
A nonexempt employee is one that isn't exempt from overtime regulations. Iowa defers to the federal Fair Labor Standard Act's regulation on overtime, which mandates that employees receive time and a half for hours worked over 40 in one week. Nonexempt adult employees in Iowa aren't entitled to any rest or meal breaks, but they must be paid at least the state minimum wage; in Iowa, the minimum wage is $7.50 an hour at the time of publication, but an employer is allowed to pay $6.75 an hour during the first 90 days of employment.
Read More: Federal Labor Laws for Salaried Employees
Exempt Salaried Employees
Exempt salaried employees don't need to be paid an overtime rate. Iowa allows an overtime exemption for employees who can be classified as exempt from the Fair Labor Standards Act, or FLSA. To be exempt, an employee must be classified as an executive, administrator, professional, salesperson or computer employee. Exempt employees must exercise some independent judgment or decision making in their work and must be paid a minimum salary of $455 a week.
Termination and Layoff Notice
Employment in Iowa is "at will." That means that either the employee or the employer can terminate the employment at any time. The Iowa Workforce Development Department notes that employers are not required to give salaried or hourly employees notice before they terminate them. However, the federal Worker Adjustment and Retraining Act requires that employers in Iowa, as elsewhere in the United States, give at least 60 days' notice of mass layoffs.
Iowa law does stipulate that an employer can terminate a salaried employee for any reason. However, the employee may have recourse for wrongful termination. If an employee is terminated for discriminatory reasons -- for example, based on her age, religion, pregnancy or race, among other things -- she can bring legal action against an employer. She also has grounds for legal action if she's fired for whistleblowing or trying to comply with safety regulations or if she was guaranteed employment in a legal contract.
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