Plain-English summary
Court holds daily-rate high earners aren’t automatically salaried executives exempt from overtime
The Court ruled that Michael Hewitt, an offshore supervisor paid a high daily rate, was not an executive exempt from the Fair Labor Standards Act’s (FLSA) overtime protections. The decision requires that daily-rate workers meet specific regulatory conditions to qualify as salaried exempt employees.
Why this matters
The ruling clarifies that employers cannot avoid overtime obligations simply by paying high daily rates to managers. Companies must follow the specific regulatory rules for treating daily- or fee-paid workers as salaried executives. That preserves overtime protections for many high-paid workers paid on a day-rate unless employers meet the narrow regulatory criteria.
Who may feel it
- Workers paid on a daily or fee basis (including offshore and construction employees)
- Employers who pay supervisors or managers by the day or by fee
- Labor unions and worker advocates
- Employment lawyers and HR professionals
Key questions
- Does paying a high daily rate to a supervisor make that worker a salaried executive exempt from overtime under the FLSA?
- What test or regulation determines whether daily-rate (fee-paid) workers count as paid on a salary basis for exemption purposes?