Exaggerating Job Titles Won't Magically Transform Employees' Overtime Eligibility

When did a "Receptionist" become an "Assistant Manager of Reservations?" According to a new research study, employers' use of exaggerated job titles has increased rapidly over the past decade. The study points to a trend that some employers may be attempting to avoid overtime pay by casting more employees as "managers." Understanding the intricacies of the federal overtime statute (the Fair Labor Standards Act) and equivalent state wage and hour laws is challenging - but one thing that is easily understood is that job titles alone are not necessarily determinative of whether an employee is eligible for overtime pay under the law.

 The FLSA presumes that all employees are eligible for overtime pay unless an employer can demonstrate that one of several applicable exemptions apply to an employee's position (thus making the employee "exempt"). The FLSA provides exemptions for individuals employed as bona fide executive, administrative, and professional employees – the so-called “white collar” exemptions – among some other exemptions. To qualify for a white collar exemption, employees generally must meet certain tests regarding their job duties and be paid on a salary basis of not less than $684 per week. The Department of Labor, which enforces the FLSA, has made clear that job titles do not determine exempt status. While many managers may qualify as "exempt" from overtime rules under these exemptions, employers should be careful to review each employee's job duties (both per their job description and in practice) in order to ensure that each employee clearly meets the exemption’s requirements. If an employee or group of employees within a job title are incorrectly classified as "exempt," the employer could find itself subject to a private lawsuit or enforcement action and the possibility of serious damages and back payments.