Under Massachusetts law, exempt employees (also known as salaried employees) typically include administrators, executives and professional workers who do not get overtime pay – they make the same amount each week, no matter how many hours they work.
The state Office of the Attorney General is the agency that enforces wage and overtime laws in conjunction with the federal Fair Labor Standards Act. For workers to be considered exempt, they must meet certain wage and duty requirements.
Defining Exempt vs. Nonexempt Employees
Workers fall into two categories of employees – nonexempt, those paid hourly, and exempt, or salaried. Nonexempt workers must receive overtime pay for any hours worked beyond 40 hours a week. Exempt workers do not receive overtime pay. No matter how many hours they put in during a workweek, they receive the same salary.
The Fair Labor Standards Act (FLSA) is the federal law that controls minimum wage and overtime. It classifies jobs as exempt or nonexempt by the type of job they have, how much they earn, and how they receive it. An employee must pass three tests – salary basis, salary level and duties – for the state and the FSLA to consider them a salaried worker.
Pay Threshold for Salaried Workers in Massachusetts
The salary basis test defines an employee as exempt if they are paid a predetermined and fixed salary that won't see reduction due to work variations in quantity or quality. It ensures that the worker earns a specified minimum amount to qualify as exempt.
To meet the requirements of the salary level test, exempt employees must receive at least $35,568 annually ($684 per week). Workers in Massachusetts who make more than $100,000 a year are most likely exempt.
This pay increase went into effect on January 1, 2020. Employers who did not choose to increase their exempt employees' pay could convert them to nonexempt status and pay them hourly. In that instance, the employee would have received paid time-and-a-half for the hours they worked beyond 40 hours per week.
Paying Exempt vs. Nonexempt Employees
Massachusetts employers may pay workers weekly or biweekly. If an employer changes the payment schedule – for example, from weekly to bi-weekly – it must send individual notices of the change 90 days in advance. A salaried worker can get paid once a week, bi-weekly, semi-monthly or monthly.
Workers on the job five or six days a week must receive payment within six days of the pay period's end. All other employees can receive payment within seven days of the pay period's end.
Bonafide Executives as Exempt Employees
Exempted workers must fall under three categories of "bonafide" or legitimate positions to meet the duties test requirements. An executive exemption applies to assistant managers, managers, supervisors, shift leaders and team leaders working in the Commonwealth. To satisfy the duties test for executives, an employer must prove that the executive employee:
- Mainly manages the business or a department or subdivision of it.
- Customarily and regularly directs the duties of two or more full-time employees or the equivalent.
- Has the authority to hire or fire workers, or their recommendations and suggestions regarding the advancement, hiring, firing, promotion of others carry substantial weight.
An executive must meet the requirements in the duties test, as well as the salary test requirements for disqualification from overtime pay. If their employer cannot prove all of the above elements as they relate to executive duties, that employee must receive overtime pay.
Bonafide Professionals and Administrative Workers
An employee working as a bonafide professional is one who has advanced knowledge, which they received through prolonged courses in specialized education. This employee's position requires imagination, invention, talent or originality in a known field or artistic endeavor. Professional employees must also make the above minimum salary.
A bonafide administrative employee's main duties are performing office work or other non-manual tasks directly related to general business operations or their employer's customers. They exercise independent judgment and discretion regarding significant matters. Administrative employees must also meet the minimum salary requirements to qualify as exempt employees.
Outside Salespeople and Computer Workers
Outside salespeople in Massachusetts are exempted from overtime requirements. The state law doesn't define criteria for the duties of a salesperson, however, FLSA requirements may offer some guidance. According to the FSLA, outside salespeople must make sales or obtain contracts or orders for services or the use of facilities, and regularly and customarily perform their duties away from their employer's place of business.
Massachusetts exempts workers such as systems analysts, programmers, software engineers, or other skilled computer workers from its minimum wage and overtime requirements.
Massachusetts employment law does not address the duties or type of work of computer workers. Instead it follows FLSA guidance, which states that they must apply systems analysis procedures and techniques, consult with computer users, analyze, create, design, develop, document, test, or modify programs or systems. They can also combine these duties.
Massachusetts Minimum Wage Laws
If a person is not a salaried employee, they receive hourly pay. While the federal minimum wage rate is $7.25 an hour, in Massachusetts, the minimum wage is $14.25 an hour. There are limited exceptions, including some student employees and people who receive tips.
The minimum wage for service workers, employees earning more than $20 a month in tips, is $6.15 an hour in 2022. On January 1, 2023, the minimum wage for tipped employees will be $15 an hour. The state has a different minimum wage for agriculture workers – $8 an hour in 2022, but there is an exception if the worker is 17 years of age or an immediate family member of the employer.
- Fletcher Hilton: Changes to Exempt Employee Law and Massachusetts Minimum Wage: What Employers Need to Know for 2020
- Mass.gov: Massachusetts Law About Wages
- Employment Law Handbook: Computer Employees – FLSA Exemptions
- MinimumWage.org: Massachusetts Minimum Wage for 2021, 2022
- Steffans Legal: The Ins and Outs of Overtime Pay for Salaried Executive Employees Per Massachusetts and Federal Laws
- Steffans Legal: The Ins and Outs of the Administrative Exemption
Jan Hill is a certified paralegal. She has a bachelor's degree in English and journalism, and has been writing for more than 30 years. Her work has been published in a variety of venues, including "The Warrior," the official publication of Trial Lawyer's College, ExpertHub.com, and her local daily newspaper, "The Rapid City Journal."