Exempt Employee vs Non-Exempt Employee vs Salary vs Hourly

Exempt Employees

An exempt employee is a professional, computer professional, executive, an administrative or external sales employee. By the nature of their job, they are exempt from overtime provisions as they are salaried employees. See further detail, below.

Non-Exempt Employees

Non-exempt employees are named because they are not exempt from overtime laws. If they work more than 40 hours in a workweek, then they must be paid overtime for each of the extra hours. See further detail, below.

Salaried Employees

A Salaried employee receives consistent pay regardless of the hours worked. Non-exempt employees may be paid a fluctuating workweek salary where their hours are fixed. If they work above those hours, then they must be paid overtime.See further detail, below.

Hourly Employees

An hourly employee is paid per hour worked. Most hourly employees are non-exempt and must be paid for overtime. However, some employees may be paid hourly but have exempt status because of their professions, such as doctors, lawyers, and teachers. See further detail, below.

Employees Exempted from the overtime laws

IWC Order	Affected Employees	Exemption Under IWC Order
All Orders, Section 1	Executive, Administrative and Professional employees	Sections 3 through 12 of the Orders (3 through 11 for Order 16-2001) do not apply.
All Orders, Section 1, except Orders 14 and 16	Employees in the computer software field who are paid on an hourly basis and meet all of the other requirements set forth in the Orders	Exempt from Orders (under “Professional” employee classification.)
All Orders, Section 1, except Orders 14 and 15	Employees directly employed by the State or any political subdivision thereof, including any city, county or special district.	Exempt from Orders, except Sections 1, 2, 4, 10 and 20
All Orders by operation of law (see Labor Code Section 1171)	Outside Salespersons	Exempt from Orders
All Orders, Section 1	Any individual who is the parent, spouse, child, or legally adopted child of the employer	Exempt from Orders
All Orders	Any individual participating in a national service program, such as AmeriCorps.	Exempt from Orders
All Orders, except Orders 11, 12, 15, and16	Drivers whose hours are regulated by the U.S Department of Transportation Code of Federal Regulation, Title 49, Sections 395.1 to 395.13, Hours of Service of Drivers	Exempt from overtime provisions
All Orders, except Orders 11, 12, 15, and 16	Drivers whose hours are regulated by Title 13 of the California Code of Regulations, subchapter 6.5, section 1200 et seq.	Exempt from overtime provisions
All Orders	Employees covered by a valid collective bargaining agreement if the agreement expressly provides for the wages, hours of work, and working conditions, and if the agreement provides premium wage rates for all overtime hours worked and a regular hourly rate of pay for those employees of not less than 30% more than the state minimum wage.	Exempt from overtime provisions
Orders 4 and 7	Employees (except minors) whose earnings exceed one and one-half times the minimum wage and more than half their compensation represents commissions	Exempt from overtime provisions
Order 5	Student nurses in a school accredited by the California Board of Registered Nursing or by the Board of Vocational Nurse and Psychiatric Technician Examiners	Exempt from Order 5, except Sections 1, 2, 4, 10, and 20
Order 9	Employees who have entered into a collective bargaining agreement under the Railway Labor Act	Exempt from Order 9, except Sections 4, 10, 11, 12, 20, and 22
Order 9	Taxicab drivers	Exempt from overtime provisions
Order 9	Airline employees who work over 40 but not more than 60 hours during the workweek due to a temporary modification in their normal work schedule not required by the employer and arranged at the request of the employee	Exempt from overtime provisions
Order 10	Full-time carnival ride operators employed by a traveling carnival	Exempt from Order 10, except Sections 1, 2, 4, 10, and 20
Order 10	Crew members employed on a commercial fishing boat Fish and Game Code Section7920 et seq.	Exempt from overtime provisions
Orders 10, 11, and 12	Professional Actors	Exempt from Orders, except Sections 1, 2, 4, 10, and 20
Order 10	Employees whose duties are exclusively those of a motion picture projectionist	Exempt from overtime provisions
Order 11	An announcer, news editor, or chief engineer employed by a radio or television station in a city or town with a population of 25,000 or less	Exempt from overtime provisions
Order 14	Any employee who is engaged in work that is primarily intellectual, managerial, or creative, and which requires exercise of discretion and independent judgment, and for which the remuneration is not less than two times the monthly State minimum wage for full time employment. Note: This exemption in Wage Order 14 would have to be harmonized with Labor Code section 515(a) for overtime purposes.	Exempt from Order
Order 15	Personal attendants not covered under the Domestic Worker Bill of Rights	Exempt from Order, except Sections 1, 2, 4, 10, and 15
Order 15	Any person under the age of 18 who is employed as a babysitter for a minor child of the employer in the employer’s home.	Exempt from Order

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Exempt Employee vs Non-Exempt Employee vs Salary vs Hourly

Exempt Employees

Non-Exempt Employees

Salaried Employees

Hourly Employees

Employees Exempted from the overtime laws

Affected Employees

Exemption Under IWC Order

Executive, Administrative and Professional employees

Professional Actors

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