Q: Is our ministry employee exempt from the Fair Labor Standards Act (FLSA) as an "executive" employee?

A: Salary level, salary basis, and job duties will be taken into consideration to decide if the executive exemption from the Fair Labor Standards Act applies.

To determine if the executive exemption applies, the U.S. Department of Labor’s Wage and Hour Division will look at three issues: salary level, salary basis, and job duties.

Salary Level.* Your executive must earn at least $455 per week ($23,660 per year for a full-year worker) to qualify for the exemption. Compensation may be paid biweekly, semimonthly, or monthly, but it must equal or exceed $455 a week. Check with your state's labor office to see if your state has rules that govern pay frequency.

*Note: A change to this salary level is currently on hold due to a court injunction. If the change is upheld by the court, the salary level will increase to $913 per week ($47,476 for a full-year worker). The change would also include an automatic increase to the salary threshold every three years to maintain the minimum salary level at the 40th percentile of full-time salaried workers in the lowest wage census region.

Because the consequences of misapplying the executive exemption can be costly, ministries are encouraged to seek a local attorney’s assistance when considering these questions and making a final determination.

Salary Basis. Your executive must earn a salary. This means he or she receives a predetermined amount for any week in which work is performed, regardless of the quality or quantity of the work.

Job Duties. To qualify as an executive, your employee must:

  • Primarily manage the ministry or a customarily recognized department or subdivision
  • Customarily and regularly direct the work of two or more other full-time-equivalent employees
  • Have authority or significant influence in decisions regarding hiring, firing, promoting, or disciplining other employees.

All of these criteria must be met for the executive exemption to apply to an employee. If you think a particular position might qualify for the executive exemption, it may be helpful to ask the following questions:

  • Does this employee spend more than half of his work time managing the overall ministry or a specific division of the ministry?
  • Does this employee direct the work of two or more other employees on a weekly basis?
  • Are this employee’s suggestions and recommendations regarding employment actions involving other employees carefully and regularly considered?

Because the consequences of misapplying the executive exemption can be costly, ministries are encouraged to seek a local attorney’s assistance when considering these questions and making a final determination.

Recommended Resources

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*Important information: Brotherhood Mutual is pleased to provide Legal Assist as a complimentary resource. The services we offer through Legal Assist are intended to provide general legal information to our current and prospective policyholders.

The information we provide is intended to be helpful, but it does not constitute legal advice and is not a substitute for the advice from a licensed attorney in your area. Accordingly, no attorney/client relationship is created through this process, and no legal advice will be provided. We strongly encourage you to regularly consult with a local attorney as part of your risk management program.