Salaried vs. Hourly Employees: What’s the Legal Difference? (Expanded Definition)

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Understanding the legal differences between salaried and hourly employees is crucial for ensuring fair compensation and protecting your rights under wage and hour laws. This blog post will explore these distinctions, including how misclassification can affect your pay and when to seek the assistance of an attorney near you.

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Discover the key legal differences between salaried and hourly employees, including overtime pay and misclassification issues. Understand your rights and when to consult an employment lawyer near you for potential wage theft or misclassification claims.

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Salaried vs. Hourly Employees: What’s the Legal Difference? (Expanded Definition)

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Salaried vs. Hourly Employees: What’s the Legal Difference?

Most people assume the biggest difference between salaried and hourly employees is how they’re paid. But there’s a lot more to it—especially when it comes to your rights under wage and hour laws. Whether you’re clocking in and out or receiving a set paycheck every two weeks, your employee classification has major implications for overtime pay, work hours, and legal protections.

Understanding the difference between salaried and hourly positions is essential to knowing whether you’re being paid fairly—and what to do if you’re not.

In this post, we’ll break down the legal difference between salaried and hourly employees, what it means for your paycheck, and when to contact an employment lawyer near you if your rights are being violated.

💡 For every post in this series, scroll down to “Related Posts.”

What Is a Salaried Employee?

A salaried employee is paid a fixed amount of money—usually weekly, biweekly, or monthly—regardless of the number of hours worked. But salary alone doesn’t determine your legal rights. The real question is whether you’re classified as “exempt” or “non-exempt” under federal law.

Exempt vs. Non-Exempt Status

Exempt salaried employees are not entitled to overtime pay.

Non-exempt salaried employees are entitled to overtime pay (even though they receive a set salary) if their weekly earnings fall below a certain threshold or if their job duties don’t meet exemption standards.

As of now, federal law (the Fair Labor Standards Act or FLSA) says that employees earning less than $684 per week ($35,568 annually) are usually non-exempt and must receive overtime pay for any hours worked over 40 in a week.

Many workers are wrongly classified as exempt when they should be getting paid for overtime. If you think this applies to you, it’s time to talk to an employment lawyer near you.

What Is an Hourly Employee?

An hourly employee is paid a set amount for each hour worked. These employees must be paid at least the federal or state minimum wage, and they are automatically entitled to overtime pay at 1.5 times their hourly rate for every hour worked beyond 40 in a workweek.

Most hourly employees are classified as non-exempt, meaning they’re protected by FLSA wage and hour laws.

If you’re not receiving overtime—or if your employer is asking you to work off the clock—it could be a form of wage theft. An employment lawyer near you can help you file a claim and recover unpaid wages.

Key Legal Differences: Salaried vs. Hourly Workers

Legal Aspect	Salaried Employees	Hourly Employees
Paid by the hour?	No	Yes
Guaranteed overtime pay?	Only if non-exempt	Yes (over 40 hours/week)
Wage theft protections?	Yes (but harder to prove if exempt)	Yes
Must track hours worked?	Not always (for exempt)	Yes
Must be paid minimum wage?	Yes (per hour worked if non-exempt)	Yes

It’s not uncommon for employers to blur these lines—intentionally or not. If you’re salaried and regularly working long hours with no overtime, you may be misclassified, and that’s a legal problem worth investigating.

How Employers Misclassify Employees (and Why It Matters)

Some employers deliberately classify workers as exempt salaried employees to avoid paying overtime. But just calling someone "salaried" doesn’t make them exempt under the law.

To qualify as exempt, your job duties must fall under one of the FLSA’s exemption categories, such as:

Executive

Administrative

Professional

Outside Sales

Certain Computer Employees

If your actual job duties don’t fit these categories—or you earn below the salary threshold—you should be classified as non-exempt, and you should be paid overtime.

This kind of misclassification is one of the most common forms of wage theft in the U.S. If you suspect it’s happening to you, contact an employment lawyer near you to review your situation.

What Happens If You’re Misclassified?

Misclassification can cost you thousands of dollars in unpaid wages, overtime, and benefits. Here’s what could be at stake:

Lost overtime pay

Denied meal and rest breaks (required in some states)

Unpaid off-the-clock work

Unlawful deductions from your salary

You can file a complaint with the Department of Labor (DOL) or sue your employer to recover what you’re owed. An employment lawyer near you can help you calculate your damages and fight for your rights.

Can Salaried Employees Ever Get Overtime?

Yes—if they’re non-exempt salaried employees, meaning their job duties and/or salary level don’t qualify them as exempt under FLSA. In those cases, they must receive overtime pay just like hourly employees.

Quick Example:

You earn $680/week (below the federal threshold).

You work 50 hours per week.

Your regular rate is $17/hour ($680 ÷ 40).

Your overtime rate is $25.50/hour.

You’re owed 10 hours of overtime = $255 in unpaid wages weekly.

Multiply that by 52 weeks—and you could be losing over $13,000 per year.

When to Consult an Employment Lawyer Near You

You should contact a lawyer if:

You’re working overtime but not getting paid for it.

You’re salaried but earn below the federal exemption threshold.

You’re unsure whether your duties qualify you as exempt.

You suspect you’ve been misclassified to avoid overtime pay.

You’re not getting rest breaks or proper compensation.

An employment lawyer near you can evaluate your case, calculate your back pay, and help you recover what you’re owed under the law.

Final Thoughts: Know Your Employment Classification

Your job title doesn’t determine your legal rights—your duties and earnings do. If you’re misclassified as exempt when you’re legally non-exempt, you could be missing out on significant wages and protections.

Make sure you know your rights and your classification under federal and state wage laws. And if anything doesn’t feel right, don’t hesitate to speak with an employment lawyer near you.

At ReferU.AI, we connect workers with top-rated employment lawyers near you. Our AI-powered system matches you with attorneys who specialize in wage theft, misclassification, and overtime violations—so you get expert legal help fast.

Think you’ve been misclassified? Get legal advice today.

Salaried vs. Hourly Employees: What’s the Legal Difference? (Expanded Definition)