Section 213 of Title 29 of the U.S. Code lists the categories of workers who fall outside the federal minimum wage rules, the overtime rules, or both. The FLSA exemptions under 29 USC 213 reach executive, administrative, professional, computer, and outside sales employees who meet a salary and duties test; farmworkers; seasonal amusement and recreation staff; small-newspaper workers; certain domestic companions; motor carrier employees; and a handful of narrower groups. For the white-collar categories, the salary floor is $684 per week, or $35,568 per year.1U.S. Department of Labor. Earnings Thresholds for the Executive, Administrative, and Professional Exemption That figure comes from the 2019 Department of Labor rule; a 2024 rule that would have raised it was vacated by a federal court in November 2024, so the $684 threshold controls enforcement.
Meeting the salary number is not enough. Each category has a duties test, and courts look at what the employee actually does day to day rather than what the job title says.
White-Collar Exemptions
Section 213(a)(1) removes both minimum wage and overtime protections for employees working in a bona fide executive, administrative, professional, computer, or outside sales capacity.2Office of the Law Revision Counsel. 29 USC 213 – Exemptions With two exceptions noted below, the employee must be paid on a salary basis of at least $684 per week.
Executive Employees
An executive employee’s primary duty must be managing the business or a recognized department. The employee must regularly direct at least two full-time workers and must have genuine authority over hiring or firing, or at least significant influence over those decisions.3U.S. Department of Labor. Fact Sheet 17B – Exemption for Executive Employees Under the Fair Labor Standards Act The primary-duty inquiry is where most disputes land. In Morgan v. Family Dollar Stores, Inc. (11th Cir. 2008), a jury found that store managers who spent most of their time stocking shelves, running registers, and cleaning were not exempt executives, and the resulting judgment exceeded $35 million.
Administrative Employees
The administrative exemption covers office or non-manual work directly related to management or general business operations, where the employee exercises independent judgment on significant matters.4U.S. Department of Labor. Fact Sheet 17C – Exemption for Administrative Employees Under the Fair Labor Standards Act Human resources, finance, accounting, marketing, and regulatory compliance roles often fit. The question is whether the employee genuinely makes consequential decisions or simply follows established procedures. Classifying clerical workers as administrative because they happen to work in an office is a common mistake.
Professional Employees
The professional exemption comes in two forms. Learned professionals perform work requiring advanced knowledge in a field of science or learning, typically gained through a prolonged course of specialized education. Doctors, lawyers, engineers, and CPAs are the classic examples. The test isn’t whether the employee holds a degree; it’s whether the job itself demands that level of knowledge. In Young v. Cooper Cameron Corp. (2d Cir. 2009), a product design specialist with only a high school diploma was held non-exempt because his position did not require specialized academic training, regardless of his skill.5Justia. Young v. Cooper Cameron Corp., No. 08-5847 (2d Cir. 2009)
Creative professionals do work that depends on invention, imagination, originality, or talent in a recognized artistic or creative field. Writers, musicians, actors, graphic designers, and composers can qualify. No specific educational credential is required, but the work must involve genuine creative input rather than routine production.6U.S. Department of Labor. Fact Sheet 17A – Exemption for Executive, Administrative, Professional, Computer and Outside Sales Employees Under the Fair Labor Standards Act
Computer Employees
Systems analysts, programmers, software engineers, and workers in similar roles can be exempt if their primary duty involves designing, developing, testing, or modifying computer systems or programs, or applying systems analysis techniques to determine hardware or software specifications.7U.S. Department of Labor. Fact Sheet 17E – Exemption for Employees in Computer-Related Occupations Under the Fair Labor Standards Act Computer employees can qualify either through the standard $684 weekly salary or through an hourly rate of at least $27.63.
This exemption is narrower than many employers assume. Help desk technicians, IT support staff, and workers who mainly install or troubleshoot hardware generally do not qualify. The line runs between employees engaged in systems-level analysis and design and those who use computers as tools or maintain what others have designed. If the job mainly involves following scripts to solve user problems, the exemption almost certainly does not apply.
Outside Sales Employees
Outside sales employees have no salary threshold. To qualify, the employee’s primary duty must be making sales or obtaining contracts for services, and the employee must regularly perform that work away from the employer’s place of business.8U.S. Department of Labor. Fact Sheet 17F – Exemption for Outside Sales Employees Under the Fair Labor Standards Act Real estate agents and traveling sales representatives are typical examples. In Christopher v. SmithKline Beecham Corp. (2012), the Supreme Court held that pharmaceutical sales representatives who obtained nonbinding commitments from physicians to prescribe certain drugs qualified as outside salespeople, even though they never completed a traditional sale.9Justia. Christopher v. SmithKline Beecham Corp., 567 U.S. 142 (2012) Employers relying on the exemption need to confirm that employees actually spend most of their time in the field rather than at a desk.
Highly Compensated Employees
Workers who earn at least $107,432 in total annual compensation, including at least $684 per week paid on a salary basis, face a simplified duties test.10U.S. Department of Labor. Fact Sheet 17H – Highly-Compensated Employees and the Part 541 Exemption Under the Fair Labor Standards Act Instead of meeting every element of the executive, administrative, or professional duties tests, the employee needs only to perform office or non-manual work and regularly perform at least one duty that would qualify under those standard tests. A well-paid employee who regularly directs two other workers’ schedules can be exempt on this basis even if the rest of the executive test isn’t fully met. These figures also come from the 2019 rule and remain in effect after the 2024 rule was vacated.
Salary Basis Rules and the Safe Harbor
The salary basis test is where many employers accidentally destroy an exemption. An exempt employee must receive the full predetermined salary for any week in which they perform work, regardless of the quantity or quality of that work. Docking an exempt employee’s pay because they left two hours early on a Wednesday can defeat the exemption for the entire classification of affected workers.
Federal regulations list the permissible deductions that do not jeopardize exempt status:11eCFR. 29 CFR 541.602 – Salary Basis
- Full-day absences for personal reasons unrelated to illness.
- Full-day sick leave when the employer has a bona fide sick-pay plan and the employee has exhausted or not yet qualified for benefits.
- Unpaid FMLA leave.
- Penalties for serious safety infractions, such as smoking in an explosives facility.
- Full-day disciplinary suspensions for workplace conduct violations imposed under a written policy that applies to all employees.
- Prorated pay for the first and last partial weeks of employment.
When an improper deduction happens, a safe harbor can preserve the exemption. The employer must have a written policy prohibiting improper deductions and providing a complaint mechanism, must reimburse the employee for any improper deduction once discovered, and must commit in good faith to comply going forward. Failing to reimburse, or continuing improper deductions after complaints, loses the safe harbor.
Agricultural Workers
All employees working in agriculture are exempt from overtime requirements under Section 213(b)(12).12U.S. Department of Labor. Fact Sheet 12 – Agricultural Employment Under the Fair Labor Standards Act Section 213(a)(6) goes further and exempts workers on smaller farms from both minimum wage and overtime.
The minimum wage exemption for small farms turns on whether the employer used more than 500 man-days of agricultural labor in any calendar quarter of the preceding year. A man-day is any day on which an employee performs at least one hour of farm work, regardless of the total hours worked that day.13eCFR. 29 CFR 780.305 – 500 Man-Day Provision Roughly, 500 man-days equals about seven full-time employees over a 13-week quarter. All workers count, including part-time, seasonal, and temporary laborers across all operations the same farmer manages. Immediate family members of the farm owner are exempt regardless of farm size.
Federal law defines agriculture to include cultivating soil, harvesting crops, raising livestock, and related activities like packing and preparing goods for market when performed on a farm.14Legal Information Institute. 29 USC 203(f) – Definition of Agriculture The further work moves toward industrial processing, the weaker the exemption becomes. In Holly Farms Corp. v. NLRB (1996), the Supreme Court held that poultry workers who collected broilers for slaughter were tied to processing operations rather than farming.15Justia. Holly Farms Corp. v. NLRB, 517 U.S. 392 (1996) Several states now extend overtime protections to farmworkers beyond federal law, so agricultural employers in those states may owe overtime even when the federal exemption applies.
Seasonal Amusement and Recreational Establishments
Under Section 213(a)(3), employees of amusement or recreational establishments, organized camps, and nonprofit educational conference centers are exempt from both minimum wage and overtime if the employer meets one of two tests.16U.S. Department of Labor. Fact Sheet 18 – Section 13(a)(3) Exemption for Seasonal Amusement or Recreational Establishments Under the Fair Labor Standards Act The business must either operate for no more than seven months in any calendar year, or show that its average receipts during the six slowest months of the prior year were no more than one-third of average receipts during the other six months.
Ski resorts, summer camps, water parks, and minor league baseball teams commonly rely on this exemption. In Jeffery v. Sarasota White Sox, Inc. (11th Cir. 1995), a minor league team qualified because its operations did not extend beyond seven months. A year-round business isn’t automatically disqualified; it can still meet the revenue test if off-season income drops far enough below peak. The exemption does not apply to employees of private companies operating under contract within national parks, national forests, or National Wildlife Refuge System lands, except for businesses providing services directly related to skiing.
Commissioned Retail Employees
The exemption often lumped in with Section 213 for commissioned workers actually appears in Section 7(i) of the Act, at 29 USC 207(i).17Office of the Law Revision Counsel. 29 U.S. Code 207 – Maximum Hours It covers overtime only, not minimum wage. To use it, the employer must show that the employee works at a retail or service establishment, earns a regular rate exceeding one and a half times the applicable minimum wage, and receives more than half of total compensation from commissions over a representative period.
The representative period used to measure commission earnings cannot be shorter than one month and must be long enough to smooth out seasonal swings.18eCFR. 29 CFR 779.417 – The Representative Period for Testing Employee’s Compensation Employers need to use the most recent period for which data is available, and if the chosen period stops reflecting the employee’s actual earnings pattern, the employer must switch. If base pay overtakes commission earnings during a given period, the exemption can fail for that stretch. Car dealerships, appliance retailers, and similar performance-based businesses are the typical users.
Small Newspapers, Companionship Workers, and Motor Carriers
Section 213 contains a long tail of narrower exemptions.
Workers employed in connection with a weekly, semiweekly, or daily newspaper are exempt from both minimum wage and overtime if the paper has a circulation under 4,000 and most of that circulation stays within the county of publication and adjacent counties. This is Section 213(a)(8).
Under Section 213(a)(15), domestic workers employed on a casual basis for babysitting, or to provide companionship services for elderly or disabled individuals, are exempt from minimum wage and overtime. A 2015 DOL rule narrowed who can claim this exemption. Third-party employers like home care staffing agencies can no longer use it, even if the worker’s duties meet the companionship definition. Only the individual, family, or household that directly employs the worker may claim it.19U.S. Department of Labor. Fact Sheet 79A – Companionship Services Under the Fair Labor Standards Act
Section 213(b)(1) exempts from overtime any employee over whom the Secretary of Transportation has authority to set qualifications and maximum hours of service. This mainly covers drivers, driver’s helpers, loaders, and mechanics whose work affects the safe operation of commercial motor vehicles on public highways. Because Department of Transportation regulations already govern their hours, Congress carved them out of the FLSA’s overtime rules. Airline employees and railroad workers covered by the Railway Labor Act are similarly exempt under separate provisions.
What Misclassification Costs
Getting an exemption wrong is expensive. Under 29 USC 216(b), an employer that fails to pay required minimum wages or overtime owes the full amount of unpaid wages plus an equal amount in liquidated damages, doubling the liability.20Office of the Law Revision Counsel. 29 USC 216 – Penalties The court must also award reasonable attorney’s fees and costs to the prevailing employee. That formula produced the $35 million-plus judgment in Morgan v. Family Dollar.
The statute of limitations is two years from the date of the violation, extended to three years when the violation is willful, meaning the employer either knew the classification was wrong or showed reckless disregard for whether it was.21Office of the Law Revision Counsel. 29 USC 255 – Statute of Limitations The extra year can add substantial back pay exposure in class actions.
Beyond private lawsuits, the Department of Labor can assess civil money penalties of up to $2,515 per violation for repeated or willful failures to pay minimum wage or overtime.22U.S. Department of Labor. Civil Money Penalty Inflation Adjustments Individual officers and agents of the company can also face personal liability for unpaid wages in some circumstances. When an employer applies an exemption broadly without matching each employee’s actual duties to the legal requirements, the cost of getting it wrong tends to dwarf whatever was saved by not paying overtime.