In Texas, salaried employees refer to individuals who receive a predetermined fixed amount of compensation at regular intervals, typically on a weekly or less frequent basis.
There are specific laws and regulations in place that govern the rights and responsibilities of both salaried employees and their employers.
This article aims to provide a comprehensive overview of the relevant laws and regulations applicable to salaried employees in Texas. It will focus on various aspects, including pay, break and leave entitlements, as well as the classification of employees as exempt or non-exempt.
This article covers:
- Payment of Wages for Salaried Employees in Texas
- Salaried Employees Eligibility for Overtime for Texas
- Overtime Exemption for Texas Salaried Employees
- Overtime Pay for Texas Salaried Employees
- Time Tracking of Salaried Employees Hours in Texas
- Salaried Employees on Fluctuating Workweeks in Texas
- Deductions from Exempt Employee Salary in Texas
- Break Entitlements for Salaried Employees in Texas
- Leave Entitlements for Salaried Employees in Texas
- Termination of Employment for Salaried Employees in Texas
Texas employers must adhere to specific rules regarding the frequency of wage payments to non-exempt employees.
Generally, non-exempt workers must be paid at least twice a month on designated paydays.
In cases where an employer has not established a payment schedule, the paydays default to the first and fifteenth days of each month.
However, employees who are exempt under the Fair Labor Standards Act (FLSA) have different payment requirements. FLSA regulations stipulate that exempt employees must be paid at least once per month.
Employees who receive a guaranteed minimum amount of money each week, regardless of the number of hours worked, are considered salaried. This designation is not dependent on whether the compensation is defined on an annual basis.
The Fair Labor Standards Act (FLSA) protects both salaried and hourly employees by ensuring they receive a minimum wage and overtime pay.
Salaried employees are entitled to minimum wage and overtime pay, with only a few limited exemptions.
In Texas, unless an employee earns a minimum weekly salary of $684 ($35,568/year) and falls into a legally recognized exemption category, they must receive overtime pay.
Employers must demonstrate that their employees meet these exemption criteria in order to exempt them from overtime pay.
Certain Texas employees who earn a minimum weekly salary of $684 ($35,568/year) and fall into a legally recognized exemption category are exempt from overtime pay.
There are three main exemptions to overtime pay laws based on an employee’s duties, which fall into the categories of executive, administrative, and professional roles.
On the other hand, examples of exemption categories that are not based on salary, but rather based on profession include workers covered by federal labor laws other than the FLSA, outside salespeople, movie theater employees, and certain agricultural workers. Download U.S. FLSA Exemption Salary Threshold 2024 Poster now.
Determining the amount of overtime pay for nonexempt salaried employees can be done using different calculation methods. The chosen calculation method affects the determination of overtime pay for salaried employees.
The weekly method is commonly used, where the monthly salary is multiplied by 12 to obtain the annual salary, then divided by 52 weeks to get the weekly salary. Finally, the weekly salary is divided by the number of hours the employee is expected to work in a week to earn a full salary.
For instance, if an employee earns $2,000 per month and works 40 hours per week, the hourly rate is calculated to be $11.54.
Overtime pay is then calculated at one and a half times this hourly rate for the number of overtime hours.
Alternatively, the monthly method can be used if the employer obtains the employee’s consent before work is performed. In this method, the monthly salary is divided by the number of work hours in the month.
For example, if the employee earns $2,000 per month and works four hours per week in a month with 160 work hours, the hourly rate is $12.50.
Overtime pay is then calculated accordingly at one and a half times this hourly rate.
It’s important to note that employers cannot unilaterally require the use of the monthly calculation method without the employee’s consent.
Salaried employees receive a set salary, removing the need for them to monitor working hours and enabling them to concentrate on their tasks within reasonable time frames. However, maintaining records and timesheets of hours can be beneficial in situations such as unexpected absences, vacations, holidays, and sick days.
Furthermore, tracking payroll hours and ensuring compliance with overtime hours (if applicable based on company policies) can be important. While it’s not mandatory, these records provide valuable information for salaried employees regarding tracking time off and compensation.
Discover additional information about time tracking for salaried and hourly workers in the US.
The Fluctuating Workweek Method (FWW) allows certain salaried employees to receive overtime compensation at a rate of one-half (0.5) times their regular hourly rate.
To qualify for overtime pay under the FWW, eligible employees must have a fluctuating workweek, meaning they sometimes work more or fewer than 40 hours a week.
Additionally, their minimum hourly wage must equal $7.25 per hour.
According to the Fair Labor Standards Act (FLSA), it is generally not permissible to reduce the pay of salaried employees based on the number of days or hours worked. However, there are certain exceptions to this rule.
Employers are allowed to dock the pay of exempt employees under circumstances that include:
- When the employee does not perform any work during an entire week.
- When the employee is absent for reasons unrelated to sickness or accident.
- As a penalty for violating a major safety rule.
- To offset amounts received by the employee for serving as a juror or witness, or for military pay (the deductions should not exceed the amount received by the employee).
- While the employee is on disciplinary suspension for violating workplace conduct rules.
- For partial weeks worked at the beginning or end of an employee’s tenure.
- When the employee is taking intermittent leave under the Family and Medical Leave Act (FMLA) and has exhausted all available paid leave.
Under both federal and state laws, employers in Texas are not obligated to provide rest or meal breaks to their employees. The decision to offer breaks is at the discretion of the employer.
However, there are certain exceptions and regulations that employers must follow if they choose to provide breaks. If a break lasts for 20 minutes or less, the employee must be compensated for that time.
Conversely, if an employee takes a meal break that lasts for 30 minutes or more, it does not need to be paid, and the employee should be completely relieved of their duties.
However, if an employee is required to work during a meal break, such as customer service agents or call center employees, they must be compensated for that time.
It is important to note that in Austin, Texas, construction workers are entitled to a rest break of at least 10 minutes for every four hours worked.
Salaried employees in Texas are entitled to various forms of leave and benefits. Sick leave is available to both full-time and part-time employees, accruing at a rate of 8 hours per month for full-time employees. This paid sick leave can be used for personal illness, injury, pregnancy, or caring for an immediate family member.
Parental leave is also provided for eligible employees, allowing up to 12 weeks of unpaid leave for the birth, adoption, or foster care placement of a child. Family and Medical Leave Act (FMLA) provides up to 12 weeks of unpaid leave for employees who meet certain criteria.
Additionally, employees can utilize emergency leave in case of a family member’s death, while various service leaves are available including military service leave, volunteer services leave, voting absence, jury service leave, and leave for organ, bone marrow, or blood donation.
Lastly, administrative leave for exceptional performance as well as paid holidays and vacation time are also granted to state employees in Texas.
In Texas, the employment relationship is generally governed by the principle of “employment-at-will,” which allows employers to terminate employees at any time and for any reason, and similarly allows employees to resign from their positions without explanation.
However, there are exceptions to this doctrine if wrongful termination occurs. Such is if an employer dismisses an employee based on criteria such as sexual orientation, military duty, veteran status, reporting suspected wrongdoing, discrimination based on race, color, religion, gender, pregnancy, age, national origin, or disability, jury duty, voting, or union membership.
When an employment relationship ends in Texas, there are specific rules regarding the final payment of wages.
If an employee is discharged, the employer must make the final wage payment within 6 calendar days. If an employee resigns, the employer must make the final wage payment by the next regularly scheduled payday.
Learn more about Texas 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.