Paying an employee a salary does not render him or her exempt from overtime pay, the U.S. Department of Labor (DOL) recently reminded employers.
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In announcing an almost $2 million settlement with a Citigroup subsidiary, the administrator of DOL’s Wage and Hour Division (WHD), made clear that many Fair Labor Standards (FLSA) requirements apply, even if an employee is paid on a salary basis. “Employers must understand that simply paying an employee a salary does not necessarily mean the employee is not eligible for overtime,” David Weil said.
After a DOL investigation revealed that Citigroup Technology Inc. had misclassified 882 employees, the company agreed to resolve the findings for $1,870,009 in back wages and $97,680 in a civil penalty.