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Ask the Hotline | Who Is Exempted from Overtime?

April 9, 2019
 
Question
 
In a recent court case, the Massachusetts Supreme Judicial Court referred to exceptions to the Massachusetts overtime law. My owner was wondering if our company may qualify. Could you provide more information?
 
Answer 
 
The state’s overtime statute (MGL 151 S1A) currently includes 20 exceptions for work performed in certain locations or in certain businesses. 
 
According to the federal Fair Labor Standards Act (FLSA) and the Massachusetts minimum wage laws, nearly all non- exempt (i.e. hourly) employees must be paid overtime (1.5 times their hourly wage) for all hours worked more than 40 in a workweek. The overtime rate is to be based on the actual pay an employee receives per hour of work. 
 
Certain forms of income do not count. Massachusetts law recognizes that “sums paid as commissions, drawing accounts, bonuses, or other incentive pay based on sales or production, shall be excluded in computing the regular rate and the overtime rate of compensation.”
 
Another caveat specifically involves retail employees, who for many years received “premium pay” for work on Sunday, no matter how many hours they worked during the week. The premium pay rate was set at 1.5 times an employee’s hourly rate, but it was never defined as overtime. 
 
As of this year, the grand bargain gradually raised the minimum wage and slowly began to reduce the premium pay, so that in 2023 the minimum wage will be $15 an hour and the premium pay will be eliminated. 
 
Overtime exemptions
 
Here the list of exemptions as included in chapter 151. 
  1. As a janitor or caretaker of residential property, who when furnished with living quarters is paid a wage of not less than thirty dollars per week.
  2. As a golf caddy, newsboy or child actor or performer.
  3. As a bona fide executive, or administrative or professional person or qualified trainee for such position earning more than eighty dollars per week.
  4. As an outside salesman or outside buyer.
  5. As a learner, apprentice or handicapped person under a special license as provided in section nine.
  6. As a fisherman or as a person employed in the catching or taking of any kind of fish, shellfish or other aquatic forms of animal and vegetable life.
  7. As a switchboard operator in a public telephone exchange.
  8. As a driver or helper on a truck with respect to whom the Interstate Commerce Commission has power to establish qualifications and maximum hours of service pursuant to the provisions of section two hundred and four of the Motor Carrier Act of nineteen hundred and thirty-five, or as employee of an employer subject to the provisions of Part 1 of the Interstate Commerce Act or subject to title II of the Railway Labor Act.
  9. In a business or specified operation of a business which is carried on during a period, or accumulated periods, not in excess of one hundred and twenty days in any year and determined by the commissioner to be seasonal in nature.
  10. As a seaman.
  11. By an employer licensed and regulated pursuant to chapter one hundred and fifty-nine A.
  12. In a hotel, motel, motor court or like establishment.
  13. In a gasoline station.
  14. In a restaurant.
  15. As a garageman, which term shall not include a parking lot attendant.
  16. In a hospital, sanitorium, convalescent or nursing home, infirmary, rest home or charitable home for the aged.
  17. In a non-profit school or college.
  18. In a summer camp operated by a non-profit charitable corporation.
  19. As a laborer engaged in agriculture and farming on a farm.
  20. In an amusement park containing a permanent aggregation of amusement devices, games, shows, and other attractions operated during a period, or accumulated periods, not in excess of one hundred and fifty days in any one year.
Each exception has its own unique legislative history explaining its purpose and scope. That means it may be worth the time to research the topic to make sure the exception applies to your company or industry. Examples of research would include prior court decisions, opinion letters from the Division of Labor Standards and legislative histories. 
 
The Supreme Judicial Court case also highlights the fact that state and federal rules about exceptions do not always agree. 
 
The U.S. Department of Labor (DOL) has its own list of exceptions that need to be reviewed as well. Sometimes the DOL has exceptions on its list that are not on the Massachusetts list. In that case, the federal exception will apply. 
 
The DOL also has an extensive list of opinion letters that may help to clarify the applicability of a particular exception.
 
AIM members may learn more about this and other HR-related issues by calling the Employer Hotline at 800-470-6277. 
 
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