Alabama Salaried Employees Laws

January 29th 2024

In Alabama, salaried employees are those who receive predetermined fixed compensation regularly, such as weekly or less frequently.

The state has established laws and regulations that define the rights and responsibilities of both salaried employees and their employers.

This article aims to offer an overview of these regulations, covering topics like payment procedures, break and leave benefits, and the classification of employees as exempt or non-exempt.

This article covers:

Payment of Wages for Salaried Employees in Alabama

In Alabama, specific payday regulations are absent, yet standard pay frequency choices mirror those in the rest of the US:

  • Weekly: 52 paychecks yearly, issued each week
  • Biweekly: 26 paychecks yearly, every two weeks
  • Semi-monthly: 24 paychecks yearly, twice a month
  • Monthly: 12 paychecks yearly, once a month

These options grant employees a designated number of paychecks annually. Notably, Alabama law requires public service transportation corporations with over 50 employees to provide biweekly paychecks. Frequently, employers may need to establish payment schedules and obtain approvals from their employees, ensuring that these processes are followed as required.

Salaried Employees Eligibility for Overtime for Alabama

In Alabama, since there are no specific state regulations regarding overtime, the state adheres to the federal Fair Labor and Standards Act (FLSA) guidelines.

Under the FLSA, salaried employees in Alabama can be eligible for overtime if they don’t meet criteria that exempts them from it. Exempt employees are those whose job responsibilities and compensation make them ineligible for overtime pay under the law, thus being exempt from overtime regulations. On the other hand, non-exempt employees are those whose job roles do not meet the exemptions defined by the FLSA, entitling them to receive overtime pay.

According to FLSA, employers must provide additional pay to non-exempt employees for any hours worked beyond 40 in a week. This premium pay in Alabama is defined as a minimum of 1.5 times the regular rate of an employee’s pay.

Additionally, since May 20, 2020, salaried employees with varying work hours have the right to receive overtime pay at half (0.5) times their hourly rate for each overtime hour through the “fluctuating workweek” (FWW) method for hours worked beyond the standard 40 hours.

To qualify for the FWW, employees must experience varying hours week to week, earn a fixed salary regardless of weekly hours, and achieve an hourly rate at or above the federal (or state) minimum wage.

Pay for Working Overtime for Alabama Salaried Employees

In terms of overtime calculations for salaried employees, the regular rate must first be determined. This regular rate is determined by dividing the salary by the number of hours it is meant to cover.

When the standard hours worked in a week are fewer than 40, the process involves adding the regular rate for each hour up to 40.

Beyond these 40 hours, overtime is required, which is compensated at one and a half times the regular rate. In the case where the standard working hours are exactly 40, any hours worked beyond this threshold are subject to overtime pay at a rate of one and a half times the regular rate.

Although such computations might appear complex, modern employers can simplify and streamline them using tools such as a timesheet app, monitoring time and attendance, or even employing overtime compliance software.

Exceptions to Overtime Exemptions for Alabama Salaried Employees

According to the U.S. Department of Labor (DOL), starting from January 1, 2020, employees earning an annual salary of less than $35,568 are considered nonexempt and are eligible for overtime pay. Nevertheless, certain employees are exempt from this regulation and are not eligible for overtime pay. These exceptions comprise:

  • Highly compensated employees making over $107,432 per year
  • Executive, Administrative, Learned, and Creative Professional workers with a minimum weekly salary of $684
  • Computer employees on a salary basis earning at least $684 weekly
  • Outside sales employees

It’s vital to recognize that “blue-collar” workers, including police officers, firefighters, paramedics, and other community service employees, are not exempt from the overtime rule. 

Learn more in detail about Alabama Overtime Laws.

Violation of Salaried Employees Wages Payment in Alabama

As Alabama lacks state-level regulations concerning matters related to wages and working hours, federal regulations under Fair Labor Standards Act (FLSA) apply.

When an employer refuses to provide your paycheck, this is referred to as salary withholding. According to the FLSA, there are several avenues through the federal government to help employees recover any owed wages from their employer.

The federal Department of Labor’s Wage and Hour Division has the authority to assist the employee in recovering unpaid wages. The Secretary of Labor has the option to take legal action against the employer to obtain back pay and impose a penalty on them.

Alternatively, employees have the option to personally file a lawsuit against their employer if they are not providing their paycheck. Lastly, employees can initiate a complaint with the State of Alabama Department of Labor, which will undertake an investigation on their behalf.

Male and Female Salaried Employees in Alabama

The Clarke Figures Equal Pay Act, House Bill 225, was signed into Alabama law on June 11, 2019 with an effective date of August 1. This new law aligns Alabama with over a dozen other states that forbid employers from discriminating against job applicants based on their salary history.

According to this legislation, employers are not allowed to pay an employee of one race or gender a lower wage compared to another employee in the same establishment, if their work involves “equal skill, effort, education, experience, and responsibility” in similar working conditions. However, employers can still establish wage differences based on seniority, merit, production-related metrics, or factors unrelated to gender or race.

The Act further specifies that employers cannot retaliate or refuse opportunities to applicants who decline to disclose their wage history. Unlike most states, Alabama’s law permits employers to ask about salary history, but discrimination based on an applicant’s refusal to provide such information is prohibited. Moreover, employees have a two-year window from the alleged violation to file a lawsuit under this Act.

Leave Entitlements for Salaried Employees in Alabama

In Alabama, salaried employees have several types of leave available to them. Public sector employees benefit from Holiday Leave, ensuring they have time off on federal and state holidays, promoting a work-life balance. The Family and Medical Leave Act (FMLA) provides up to 12 weeks of unpaid leave for qualifying reasons, including birth and caring for a family member’s serious illness.

Voting Leave ensures registered employees receive up to one hour of unpaid leave to vote. Jury Leave mandates paid time off for jury duty summons. Disaster Response Leave supports American Red Cross volunteers with up to 15 workdays for emergency response, maintaining pay and benefits. Military Leave guarantees workers can fulfill military obligations without losing regular pay, holiday leave, or sick leave. These provisions cater to various circumstances, offering valuable flexibility and support to salaried employees in Alabama.

To guarantee that employees fully utilize their entitled leave benefits, especially those linked to their work hours, it may be essential to monitor work hours or employ automated systems for tracking time off to streamline the procedure.

Break Entitlements for Salaried Employees in Alabama

In Alabama, specific regulations for breaks and meal periods are absent, following the guidelines of the federal Fair Labor Standards Act (FLSA). This means that the state doesn’t have its own laws requiring employers to provide meal or rest breaks. Instead, adherence to break periods is governed by FLSA, which doesn’t mandate employers to offer coffee or lunch breaks during working hours. Deciding break times and arrangements is a matter to be negotiated between employers and employees. Both parties should be aware of their respective rights and obligations concerning breaks and meal periods.

There are certain exceptions to break regulations in Alabama. Employers have the flexibility to go beyond the minimum requirements and provide additional perks like paid breaks or flexible work schedules, while employees have the opportunity to communicate their preferred break times. This lack of stringent state laws creates an environment for constructive dialogue between employers and employees. In Alabama, brief breaks lasting from 5 to 20 minutes are considered as work hours and must be compensated by the employer. However, longer, genuine meal breaks of at least 30 minutes are regarded as unpaid rest periods. The unpaid status becomes void if an employee is required to work during this designated meal break.

Deductions from Exempt Employees’ Salary in Alabama

The ability to reduce the salary of an exempt employee in Alabama is restricted. Normally, deductions from the pay of an exempt employee should only occur in full-day portions. An exemption to this is if the employee is absent for a portion of a day due to a Fair Labor Standards Act FMLA-related reason, in which case their pay can be docked. Otherwise, deductions must be made in full-day units at minimum. 

The Department of Labor has guidelines outlining situations when an exempt employee’s salary can be docked. Incorrect deductions from the salary of an exempt employee can potentially invalidate the exemption and lead to the employer having to pay back wages.

Termination of Employment for Salaried Employees in Alabama

The “at-will doctrine” prevails in numerous US states, including Alabama, where employees can be terminated without a specific cause. However, this doesn’t permit discrimination based on prohibited factors like race or age. Wrongful termination, occurring when firing happens for such reasons, grants employees the right to legal action. Conversely, employees have the freedom to resign without consequences. Comprehending these rules ensures fairness for both parties in Alabama’s workplace.

Alabama lacks state regulations for final paychecks, adhering to federal law. Immediate payout isn’t obligatory. However, for sales representatives, commissions must be paid within 30 days of contract termination, resignation, or expiry. Unresolved matters like unused leave or benefits rely on employer-employee agreements. Queries can be directed to the Alabama Department of Labor for guidance.

Learn more about Alabama Labor Laws through our detailed guide.

Important Cautionary Note

When making this guide we have tried to make it accurate but we do not give any guarantee that the information provided is correct or up-to-date. We therefore strongly advise you seek advice from qualified professionals before acting on any information provided in this guide. We do not accept any liability for any damages or risks incurred for use of this guide.