Yes. A salaried employee can be owed overtime, because being paid a salary is not the same as being exempt. Under the federal Fair Labor Standards Act (FLSA), an employee is exempt from overtime as an executive, administrative or professional employee only if three tests are all met: the salary basis test, the salary level test (at least $684 a week, or $35,568 a year, as of October 20, 2026) and the duties test. Fail any one of them and this exemption does not apply: unless another FLSA exemption covers the job, overtime at 1.5 times the regular rate is owed for every hour over 40 in a workweek, salary or not.
Salaried is not the same as exempt
"Salaried" describes how someone is paid. "Exempt" describes whether the overtime rules apply. Most exempt employees are salaried, but the reverse does not hold.
The Department of Labor summed up the rule in its May 15, 2026 Federal Register notice: an employee is generally exempt only if (1) the job duties primarily involve executive, administrative or professional work as defined in the regulations, (2) the pay is a predetermined, fixed salary not reduced because of the quality or quantity of the work, and (3) that salary meets a minimum amount (91 FR 27833).
These people are salaried and may still be owed overtime:
- an office assistant paid $900 a week whose work is filing, scheduling and answering phones (usually fails the duties test),
- a shift supervisor paid $640 a week (fails the salary level test, whatever the duties),
- a salaried coordinator whose employer docks pay for partial days when there is no work (can fail the salary basis test).
Test 1: salary basis (29 CFR 541.602)
The employee must receive a predetermined amount each pay period, weekly or less often, that is not reduced because of the quality or quantity of the work. The full salary is due for any week in which the employee does any work, however few days or hours (29 CFR 541.602).
The regulation lists the deductions that do not break the salary basis:
| Allowed deduction | Condition |
|---|---|
| Personal absence | Full days only, not sickness |
| Sickness or disability | Full days, under a bona fide plan or policy |
| Jury duty, witness, military leave | Only offsetting the fees or military pay received |
| Major safety rule penalty | Rules preventing serious danger |
| Disciplinary suspension | Full days, under a written policy for all employees |
| First and last week of employment | Pay for the time actually worked |
| Unpaid FMLA leave | Proportionate part of the salary |
Up to 10 percent of the salary level can come from nondiscretionary bonuses, incentives and commissions paid at least once a year.
Test 2: salary level (29 CFR 541.600)
Current federal level: $684 per week, equal to $35,568 a year for a full-year worker (29 CFR 541.600, checked October 20, 2026). Paid less often, the same floor is $1,368 biweekly, $1,482 semimonthly or $2,964 monthly. The shortest period that can meet it is one week. Lower levels apply in Puerto Rico, Guam, the U.S. Virgin Islands and the Northern Mariana Islands ($455) and American Samoa ($380).
Some groups have no salary level at all: teachers, and licensed lawyers and doctors practicing their profession. Computer employees can alternatively be paid at least $27.63 an hour.
What happened to the 2024 increase. A 2024 rule raised the level to $844 a week on July 1, 2024 and would have raised it to $1,128 a week on January 1, 2025. Courts vacated it: on November 15, 2024 the U.S. District Court for the Eastern District of Texas in Texas v. U.S. Dep't of Labor, 756 F. Supp. 3d 361 (case law), and on December 30, 2024 the Northern District of Texas in Flint Avenue, LLC v. U.S. Dep't of Labor (case law). The Fifth Circuit dismissed both appeals on May 5 and 7, 2026. The Department then published a technical rule, effective May 15, 2026, that put the pre-2024 text back into the regulations and states that this version is the one it "has been enforcing" (91 FR 27833).
On October 20, 2026 the eCFR text of § 541.600 (up to date as of October 16, 2026) and the DOL page on salary levels for the exemption both show $684 per week.
Highly compensated employees (29 CFR 541.601). Someone with total annual compensation of at least $107,432, including at least $684 a week paid as salary or fee, is exempt if they customarily and regularly perform at least one exempt duty (29 CFR 541.601). Commissions and nondiscretionary bonuses count toward the total; benefits do not. If the year ends short, the employer can make one catch up payment within one month. This shortcut covers only office or non-manual work: non-management carpenters, electricians, mechanics, construction workers and similar jobs are not exempt under it however highly they are paid.
Test 3: duties (541.100, 541.200, 541.300)
The job title does not decide this. What counts is the employee's primary duty. In short:
| Exemption | Primary duty must be | Plus |
|---|---|---|
| Executive (541.100) | Managing the enterprise or a recognized department | Regularly directs 2 or more employees; can hire or fire, or recommendations on that carry particular weight |
| Administrative (541.200) | Office or non-manual work directly related to management or general business operations | Discretion and independent judgment on matters of significance |
| Professional (541.300) | Work needing advanced knowledge in a field of science or learning from prolonged specialized study, or creative work needing invention, imagination, originality or talent |
Each of the three sections also repeats the salary requirement of § 541.600, so the duties test never replaces the salary tests. An assistant manager who spends most of the week running a register usually fails the duties test even on a salary above $684.
State salary thresholds
States can set a higher bar, and where both apply the higher standard wins. These three were verified on official state sources on October 20, 2026:
| State | 2026 minimum salary for exempt status | Source |
|---|---|---|
| California | 2 x state minimum wage x 2,080 hours: 2 x $16.90 x 2,080 = $70,304 a year ($1,352 a week) | Labor Code § 515(a) and (c); $16.90 from the Department of Finance |
| New York (executive and administrative) | $1,275.00 a week ($66,300 a year) in New York City, Nassau, Suffolk and Westchester; $1,199.10 a week ($62,353.20 a year) in the rest of the state | NY DOL minimum wage FAQ |
| Washington | 2.25 x state minimum wage: $1,541.70 a week ($80,168.40 a year); computer professionals paid hourly $59.96 | L&I, September 30, 2025 |
Sources: California Labor Code § 515, the California Department of Finance minimum wage determination (which also sets $17.40 an hour from January 1, 2027, so the California threshold rises with it), the New York DOL minimum wage FAQ and the Washington L&I announcement.
New York adds a twist: some occupations that are exempt under the FLSA are still owed overtime under state law, at 1.5 times the state minimum wage rather than their own rate (NY DOL overtime FAQ). Other states can have their own salary levels and duties rules; the overtime laws by state guide covers when overtime starts in each state.
How overtime works for salaried non-exempt employees
The standard method (29 CFR 778.113)
For a non-exempt employee on a weekly salary, the regular rate is the salary divided by the number of hours the salary is meant to cover (29 CFR 778.113). Every hour over 40 is then paid at 1.5 times that rate. A monthly salary is first turned into a weekly one: x 12 ÷ 52. A semimonthly salary: x 24 ÷ 52.
Example 1: $1,000 a week for 40 hours, a 46 hour week. Regular rate $1,000 ÷ 40 = $25.00. The week: Monday to Friday 8:00 to 16:00, Saturday 8:00 to 14:00.
| Hours | Rate | Pay | |
|---|---|---|---|
| Regular (covered by the salary) | 40 | $25.00 | $1,000.00 |
| Overtime | 6 | $37.50 | $225.00 |
| Gross pay | 46 | $1,225.00 |
Example 2: $875 a week for 35 hours, a 44 hour week. Regular rate $875 ÷ 35 = $25.00. The salary covers 35 hours, so hours 36 to 40 are owed at straight time on top of it, and hours 41 to 44 at time and a half:
| Hours | Rate | Pay | |
|---|---|---|---|
| Salary (35 agreed hours) | 35 | $875.00 | |
| Extra straight time (hours 36 to 40) | 5 | $25.00 | $125.00 |
| Overtime (hours 41 to 44) | 4 | $37.50 | $150.00 |
| Gross pay | 44 | $1,150.00 |
The salary to hourly calculator gives the regular rate when you enter the weekly pay and the agreed hours a week, and the time and a half calculator gives the overtime rate.
California is stricter. For a non-exempt full-time salaried employee, Labor Code § 515(d)(1) sets the regular rate at 1/40th of the weekly salary, and § 515(d)(2) says a fixed salary pays only for regular, nonovertime hours, "notwithstanding any private agreement to the contrary". California also has daily overtime, explained in the California overtime law guide.
The fluctuating workweek method (29 CFR 778.114)
Federal law also allows a second method, the fluctuating workweek. It applies only when all of these conditions are met (29 CFR 778.114, current text from the June 8, 2020 revision):
- the employee's hours fluctuate from week to week,
- the fixed salary does not change with the hours worked, whether few or many,
- the salary is high enough to give at least the minimum wage for every hour in the longest weeks,
- employer and employee have a clear mutual understanding that the salary pays for all hours worked each week (they do not have to agree on the calculation method), and
- overtime is paid on top of the salary at not less than half the regular rate for that week.
Because the salary already paid straight time for every hour, only the half-time premium is added. The regular rate changes every week: salary (plus bonuses or premiums that must be included) ÷ hours actually worked. Since the 2020 revision, bonuses, shift premiums and commissions are expressly compatible with the method and go into the regular rate.
Example 3: $900 fixed salary, fluctuating workweek, by hand.
| Hours worked | Regular rate (salary ÷ hours) | Half-time rate | Overtime hours | Premium | Gross pay |
|---|---|---|---|---|---|
| 36 | $900 ÷ 36 = $25.00 | 0 | $0.00 | $900.00 | |
| 45 | $900 ÷ 45 = $20.00 | $10.00 | 5 | 5 x $10.00 = $50.00 | $950.00 |
| 50 | $900 ÷ 50 = $18.00 | $9.00 | 10 | 10 x $9.00 = $90.00 | $990.00 |
Minimum wage check (condition 3): in the 50 hour week $18.00 is well above the federal $7.25.
Compare the same $900 salary under the standard method, with the salary covering 40 hours (regular rate $22.50, overtime $33.75):
| Hours worked | Standard method | Fluctuating workweek | Difference |
|---|---|---|---|
| 45 | $900 + 5 x $33.75 = $1,068.75 | $950.00 | $118.75 |
| 50 | $900 + 10 x $33.75 = $1,237.50 | $990.00 | $247.50 |
The fluctuating workweek pays less for long weeks, which is why the conditions matter. In a short week the full $900 is still due; if the salary is cut when hours are low, the method does not apply (apart from occasional disciplinary deductions under § 778.114(d)).
What the overtime calculator can and cannot do
The calculator does not decide whether you are exempt. It has no salary basis, salary level or duties check. It assumes overtime is owed and calculates it.
For a salaried non-exempt week under the standard method, use the overtime calculator:
- Under "Overtime rules", pick "U.S. federal (FLSA): over 40 hours a week" (or the California, Alaska, Nevada or Colorado preset if that state's rules apply to you).
- In "Hourly rate", enter your regular rate: weekly salary ÷ the hours the salary covers, for example $1,000 ÷ 40 = 25.
- Fill in the times you actually worked.
For Example 1 it shows 40 regular hours and 6 overtime hours, "Regular pay" $1,000.00, "Overtime pay" $225.00 and "Gross pay" $1,225.00. For Example 2 (rate 25, 44 hours) it shows $1,000.00 + $150.00 = $1,150.00, which is the same total as the table above, because the extra 5 straight time hours are paid at the same $25.
What it does not do:
- No fluctuating workweek. The calculator multiplies the hourly rate you enter by 1.5 for overtime; it has no half-time mode and no regular rate that changes with the hours. Do that calculation by hand as in Example 3.
- No bonuses or commissions in the regular rate. It uses the rate you type.
- No salary floor. A week with fewer hours shows less regular pay, while a salaried employee's salary stays the same. For weeks under the salary's hours, read the overtime hours from the calculator and keep the salary as is.
For how overtime pay is treated on a federal tax return, see no tax on overtime.
This is a calculation, not legal advice. Whether a particular job is exempt depends on its actual duties and pay; the Department of Labor's Wage and Hour Division or your state labor agency can answer that for a specific case.
FAQ
Can a salaried employee get overtime pay?
Yes, if they are non-exempt. A salary alone does not make someone exempt. Under the FLSA they must also earn at least $684 a week and have executive, administrative or professional duties as defined in 29 CFR Part 541.
What is the salary threshold for exempt employees in 2026?
Federally, $684 a week ($35,568 a year), the level set in 2019 and effective January 1, 2020. The 2024 increases to $844 and $1,128 a week were vacated by federal courts and are not in effect. States can set more: in 2026, $70,304 a year in California, $1,199.10 to $1,275.00 a week for executive and administrative employees in New York, $1,541.70 a week in Washington.
Do salaried employees get time and a half or half time?
Time and a half under the standard method: the salary covers a fixed number of hours, and each hour over 40 is paid at 1.5 times salary ÷ those hours. Half time only under the fluctuating workweek method, where the salary pays for all hours and every condition of 29 CFR 778.114 is met.
Can my employer cut my salary for a slow week and still call me exempt?
Not for lack of work. Under 29 CFR 541.602 an exempt employee gets the full salary for any week with any work, and deductions for absences caused by the employer or by the business's operating needs are not allowed.
I earn over $107,432. Am I automatically exempt?
No. The highly compensated employee rule still needs at least one exempt duty performed customarily and regularly, at least $684 a week as salary, and office or non-manual work. A highly paid electrician or construction worker is not exempt under it.