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payroll

Non-Exempt Employee

An employee entitled to overtime pay under FLSA.

A non-exempt employee is entitled to minimum wage and overtime pay (1.5× regular rate for hours over 40/week) under FLSA. Most hourly employees are non-exempt, but some salaried employees are too—if they don't meet the salary threshold or duties tests for exemption. Employers must track non-exempt employees' hours worked to ensure accurate overtime calculation.

Example

An administrative assistant earns $38,000/year on salary—below the FLSA threshold, she is non-exempt and entitled to overtime pay for weeks exceeding 40 hours.

Why It Matters for Your Business

Most employees in the US are non-exempt, and failing to pay them overtime when due is a common and costly compliance failure.

Related Terms

Exempt Employee

More Payroll Terms

Employee Benefits

Non-wage compensation like health insurance and retirement plans.

Gross Pay

Total earnings before any deductions.

Net Pay

The amount received after all deductions.

Overtime Pay

Additional compensation for hours worked beyond 40 per week.

Hourly Rate

Pay rate calculated per hour worked.

Related Financial Guides & Resources

Accounting 101 GuideFinancial Statements GuideTax Deductions GuideFinancial Reports Feature

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