HR Badge #05: Employee Classification: Exempt vs. Nonexempt-HR Badge #5

Video Transcription

Video Summary

The presentation explains how Washington State’s Minimum Wage Act (MWA) distinguishes exempt and non-exempt employees. Non-exempt employees fall within the MWA definition of “employee” and receive protections like minimum wage, overtime, and paid sick leave. Exempt employees are excluded from the definition—most commonly those working in bona fide executive, administrative, or professional capacities—so overtime rules generally do not apply.

To determine exemption status, employers primarily evaluate: (1) the employee’s primary duty (principal/most important work, performed customarily and regularly), (2) whether the employee is paid on a salary basis, and (3) whether the employee meets the applicable salary threshold (noting it changes annually; a 2024 example is given). Some roles, such as teachers and academic administrators, have different salary-threshold rules.

The training outlines three key exemptions:
- <strong>Executive</strong>: manages a department/enterprise, directs at least two employees, and has hiring/firing influence.
- <strong>Administrative</strong>: office/non-manual work tied to running the organization plus discretion on significant matters (not routine clerical work).
- <strong>Professional</strong>: learned professionals, teachers (no salary threshold), and computer professionals (can qualify via salary or high hourly rate).

Coaches’ exemption status depends on their primary district job (teacher vs. custodian) and sometimes volunteer rules and “nominal fee” analysis. Misclassification can trigger agency complaints, lawsuits, back wages, double damages, and attorney’s fees.

Keywords

Washington State Minimum Wage Act (MWA)

exempt vs non-exempt employees

overtime exemption criteria

salary basis and salary threshold 2024

executive exemption duties test

administrative exemption discretion and non-manual work

professional exemption (learned, teacher, computer)

employee misclassification penalties (back wages, double damages, attorney fees)