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Understanding the Executive Employee: Definition and Criteria
Definition & Meaning
An executive employee is a type of worker who holds a managerial position within a company. To qualify as an executive employee, an individual must meet specific criteria, including:
Being paid a salary of at least $455 per week.
Having management as their primary duty, overseeing the enterprise or a recognized department.
Regularly directing the work of two or more employees.
Possessing the authority to hire or fire employees, or having significant input on these decisions.
Table of content
Legal Use & context
The term "executive employee" is commonly used in employment law, particularly in relation to wage and hour regulations. It is important in determining eligibility for overtime pay exemptions under the Fair Labor Standards Act (FLSA). This classification can impact various legal matters, including employment contracts, labor disputes, and compliance with federal and state labor laws. Users may find relevant legal forms to assist with these matters on platforms like US Legal Forms.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A regional manager at a retail chain oversees several store managers, sets sales goals, and is responsible for hiring and firing employees within their region.
Example 2: A department head in a technology firm manages a team of software developers, organizes project timelines, and has the authority to recommend promotions and terminations. (hypothetical example)
Relevant laws & statutes
The Fair Labor Standards Act (FLSA) is the primary federal law that defines executive employees and outlines the criteria for exemption from overtime pay. Additionally, various state laws may have specific provisions regarding executive classifications.
State-by-state differences
State
Notes
California
Has additional criteria for executive employees, including a higher salary threshold.
New York
Also has specific regulations that may differ from federal standards.
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
Comparison with related terms
Term
Definition
Key Differences
Managerial Employee
An employee who manages a team but may not meet all criteria of an executive.
May not have hiring/firing authority or meet salary requirements.
Non-Exempt Employee
An employee entitled to overtime pay.
Executive employees are typically exempt from overtime under FLSA.
Common misunderstandings
What to do if this term applies to you
If you believe you qualify as an executive employee, ensure your job duties align with the legal definition. If you have questions about your status or rights, consider consulting a legal professional. Additionally, you can explore US Legal Forms for templates that may assist in employment-related matters.
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