Determining exempt and non‐exempt status in the fast food industry

Abstract

The Fair Labour Standards Act is a law that determines whether an employee is considered exempt or non‐exempt. Non‐exempt employees are eligible for overtime pay (time and a half) versus exempt employees, which are not eligible for overtime pay. The Fair Labour Standards Act status is based upon job duties rather than job title. An employee is considered exempt if he/she falls into either the professional, administrative, or executive exempt categories meeting all criteria. Many positions in the fast food industry are paid the minimum wage, or close to it, due to the intense competition and low profit margins in the industry (Reynolds, 2002). In addition, many of the employees are nonexempt employees and must punch in and out on a time clock. The positions available in the fast food restaurants themselves do not meet the criteria to be exempt due to the highly routine work they perform, with the exception of some management positions.

Citation

Mueller, J. and Kleiner, B.H. (2004), "Determining exempt and non‐exempt status in the fast food industry", Management Research News, Vol. 27 No. 10, pp. 51-57. https://doi.org/10.1108/01409170410784284