A church employs three ministers and eight non-minister employees. All of the ministers are paid an annual salary. Of the eight non-minister employees, three are in management level positions, and the other five are in secretarial or clerical positions. Is the church subject to federal minimum wage and overtime compensation laws with respect to any of these employees?
The Fair Labor Standards Act ("FLSA"), the federal law that addresses minimum wage and overtime, is one of the most complex employment laws and a thorough review would require an even lengthier response. Religious organizations are not specifically exempted under the FLSA; in fact, many courts have held that this law does apply to employees of religious organizations.
Assuming the FLSA does apply, the question then becomes, which employees might be exempt under the law? In order to be exempt under the FLSA, employees must meet the salary test and the duties test. The salary test requires that a) the employee (part-time or full-time) receives a salary of at least $455 per week ($23,660 per year) and b) the employee's salary is a predetermined amount that won't be reduced due to quality or quantity of the employee's work. The duties test requires that employee's primary duties fall into one of a few limited categories (executive, administrative or professional). Both tests must be met in order for the employee to be exempt from the FLSA and its minimum wage and overtime requirements.