Fundamental Payroll Certification (FPC) Practice Exam

Who typically qualifies as exempt employees under the Fair Labor Standards Act?

1. Employees who work over 40 hours a week

2. Employees who receive bonuses regularly

3. Employees exempt from minimum wage and overtime provisions

4. All salaried employees

The correct answer is: Employees exempt from minimum wage and overtime provisions

The classification of exempt employees under the Fair Labor Standards Act (FLSA) is centered around their exemption from minimum wage and overtime pay requirements. Exempt employees typically fall into categories such as executive, administrative, professional, outside sales, and certain computer-related occupations. These employees are not entitled to overtime pay when they work more than 40 hours in a workweek, which directly relates to the provisions of the FLSA that dictate who is covered by minimum wage and overtime pay rules. The key aspect is that their job duties and salary meet the specific criteria established by the Act, allowing them to be classified as exempt. For instance, being an exempt employee means that regardless of the number of hours they work, they are not eligible for additional pay for overtime hours. This classification serves the intent of the FLSA to differentiate employees who have responsibilities and skills that warrant such an exemption from those who do not. Understanding this classification is crucial for compliance with labor laws and ensuring that employees are correctly categorized within the payroll system.