Exempt vs Non-Exempt - Know Your Rights

Exempt vs Non-Exempt:
Which are you?

Updated March 2026

Exempt employees get a salary with no overtime. Non-exempt get overtime pay at 1.5x after 40 hours. The classification is based on your job duties, not your title.

Federal minimum salary: $35,568/yearOvertime: 1.5x after 40 hoursMisclassification: back pay 2-3 years

Your Situation

Average including weeks you work late

$/hr

How this works

If you are non-exempt, hours over 40 per week are paid at 1.5x your regular rate. Exempt employees get no overtime regardless of hours worked.

Annual Pay (Non-Exempt)

$61,750

With overtime at 1.5x for 5hrs/wk over 40

Annual Pay (Exempt)

$52,000

Fixed salary, no overtime premium

Overtime Premium Per Year

$9,750

What you lose as an exempt employee vs non-exempt with 5 overtime hours per week

Weekly Pay (Non-Exempt)

$1,188

Regular + overtime

Effective Hourly Rate

$26.39/hr

Blended rate over 45 hours

What this means for you

Working 5 hours of overtime per week, being classified as non-exempt would earn you $9,750 more per year than being exempt at the same base rate. If you are regularly working these hours and your job duties do not clearly qualify for exempt status, it is worth reviewing your classification.

FactorExemptNon-Exempt
Overtime payNone - ever1.5x after 40 hours/week
Pay structureSalary (fixed)Hourly or salary
Minimum salary (federal)$35,568/year requiredNo minimum salary
Minimum wage protectionsNot coveredFully covered
Job duties testMust pass executive/admin/professional/computer/outside sales testClerical, manual, and most non-supervisory roles
Record keepingEmployer rarely tracks hoursEmployer must track all hours
Meal/rest breaksOften flexibleFederal law requires breaks tracked