Human Resource Tips

FAQs About Exempt Employees, Minimum Wage and more…

Exempt Employees

Q: What is the difference between an exempt and non-exempt employee?

A: The federal Fair Labor Standards Act (FLSA) requires employers to pay most employees at least the federal minimum wage for each hour worked as well as overtime pay for all hours worked in excess of 40 in a workweek. Employees entitled to the minimum wage and overtime are known as non-exempt employees.

The FLSA allows for exemptions from the overtime and minimum wage requirements for certain employees who work in administrative, professional, and executive jobs. These are known as exempt employees. To be considered “exempt,” these employees must generally satisfy three tests:

Salary-level test. Employers must pay employees a salary of at least $684 per week.

Salary-basis test. With very limited exceptions, the employer must pay employees their full salary in any week they perform work, regardless of the quality or quantity of the work.

Duties test. The employee’s primary duties must meet certain criteria.

Many states have their own salary and duties tests for determining whether an employee is exempt from overtime under state rules. In many cases, the state criteria are harder to meet than the federal criteria.

Note: The FLSA also has exemptions for certain computer-related and outside-sales jobs, which have slightly different tests. Specifically, the exemption for computer-related occupations allows employers to pay employees on a salary basis (at a rate of least $684 per week) or on an hourly basis (at a rate of at least $27.63 per hour). The exemption for outside sales has no minimum salary requirement.

Q: In California, the minimum salary requirement is two times the minimum wage. Is the minimum wage used for this purpose the state or my city minimum wage?

A: In California, exempt employees must meet certain salary and duties tests and must be paid at least twice the state minimum hourly wage based on a 40-hour week. The city’s minimum wage isn’t considered when determining the minimum salary requirement in California.

The state’s minimum wage differs based on the size of the employer, and therefore so does the minimum salary requirement for exemption. For the administrative, professional, and executive exemptions under state law, the minimum salary is as follows:

Employer size Minimum per week in 2021
26 or more employees $1,120
Fewer than 26 employees $1,040

Q: Can I make a deduction from an exempt employee’s salary if they miss one day of work?

A: When an employee is classified as exempt, federal law limits salary deductions to the following circumstances:

  • When an employee is absent for one or more full days for personal reasons other than sickness or disability.
  • For absences of one or more full days due to sickness or disability if the deduction is made in accordance with a bona fide plan, policy, or practice of providing compensation for salary lost due to illness.
  • To offset jury or witness fees, or for military pay.
  • For penalties imposed in good faith for infractions of safety rules of major significance.
  • For unpaid disciplinary suspensions of one or more full days imposed in good faith for serious misconduct, such as sexual harassment, workplace violence, drug, or alcohol use, or for violations of state or federal laws. The suspension must be imposed pursuant to a written policy applicable to all employees.
  • In the employee’s first or last week of employment if the employee does not work the full week; or
  • For unpaid leave taken by the employee under the Family and Medical Leave Act.

The FLSA doesn’t permit deductions from exempt employees’ salaries for any other reason.

Q: If an exempt employee takes a sick day but has exhausted all of their sick leave for the year, can I reduce their salary?

A: Under the FLSA, deductions may be made for an exempt employee’s full-day absence due to sickness after the employee has exhausted the leave allowance under the plan. For example, if your sick leave plan provides each employee with 10 paid sick days per year, and an exempt employee has exhausted the 10-day leave entitlement, a deduction of one or more full days from their salary may be allowed if all other available/applicable leave has been used. There can be no salary deduction for a partial-day absence.

Q: Can I dock the pay of an exempt employee who arrives to work late every day?

A: No. You may make salary deductions for unpaid disciplinary suspensions of one or more full days imposed in good faith for serious misconduct, such as sexual harassment, workplace violence, drug, or alcohol use, or for violations of state or federal laws. This provision doesn’t apply to performance or attendance issues.

Q: The federal minimum salary requirement equates to $35,568 per year. What if I have employees who are paid a salary of $30,000 per year?

A: If employees are paid less than $684 per week, they must be classified as non-exempt and would be entitled to overtime whenever they work more than 40 hours in a workweek, even if they satisfy the exempt duties test.

Note: Under federal law, employers are permitted to use nondiscretionary bonuses, incentive payments, and commissions to satisfy up to 10 percent of the minimum salary requirement for the administrative, professional, and executive exemptions, as long as these forms of compensation are paid at least annually. Note that some states don’t allow employers to count these other forms of compensation toward meeting the state’s minimum salary requirements.

Q: We don’t have enough work for our exempt employees. Can we prorate their salary based on actual hours worked?

A: Under the FLSA, employers are prohibited from reducing an exempt employee’s salary based on short-term, day-to-day, or week-to-week operating requirements. However, you may change exempt employees’ salaries prospectively to reflect long-term business needs, provided such adjustments are not related to the quantity or quality of work performed and the employee still receives at least $684 per week on a salary basis. For instance, you could reduce all exempt employees’ salaries by five percent for the upcoming fiscal year because of budgetary constraints (provided the reduced salary still meets minimum requirements). By contrast, you could jeopardize an employee’s exempt status by making a short-term deduction for reductions in scheduled work.

Minimum Wage

Q: If we operate in one state but an employee is working from home in another state, which state’s minimum wage would apply?

A: In general, the minimum wage where the employee works would apply, but check state and local law to be sure.

Q: Where do we find each state and city minimum wage?

A: In addition to the resources available on HR411®, the federal government and many state, and local governments publish information on the minimum wage on their websites. Additionally, the U.S. Department of Labor (DOL) publishes a list of state minimum wage rates here.

Q: How do we provide minimum wage posters to employees who are working remotely?

A: In recent guidance, the DOL said that an employer may use electronic means to post the notice as a substitute to the hard copy notice only if all employees:

  • Exclusively work remotely.
  • Customarily receive information from the employer via electronic means
  • Have “readily available access” to the electronic posting at all times,
    • such as via an internal or external website or a shared network drive or file system.

Simply emailing these notices to employees wouldn’t comply with the guidance.

If you have some employees on-site and other employees working remotely, you must post the hard copy of the FLSA notice in the workplace and are encouraged to post them via electronic means for remote employees.

States and local jurisdictions may have different rules.

Hiring and Background Checks

Q: Can we ask an applicant what their salary expectations are?

A: Many states and local jurisdictions have passed laws that restrict employers from asking about an applicant’s pay history during the hiring process (under the premise that pay history may reflect discriminatory pay practices of a previous employer). These laws generally allow you to provide the candidate with the starting salary (or salary range) for the position and ask whether it would be acceptable if the candidate were offered the position. The answer to the question of whether they permit inquiries about salary expectations can vary by jurisdiction, so check applicable laws before asking these questions. To err on the side of caution, you may want to state clearly that the candidate shouldn’t reveal what they earned in their previous job when providing salary expectations. Additionally, keep in mind that the applicant’s salary expectations could be low because of past discrimination.

Q: Can I ask about criminal history on application forms?

A: In numerous jurisdictions, employers are prohibited from asking about criminal history on application forms. In many cases, these laws require employers to wait until later in the pre-employment process, such as after a conditional job offer, before asking about criminal history. While there’s no federal law specifically prohibiting employers from asking applicants if they’ve ever been convicted of a crime, the Equal Employment Opportunity Commission (EEOC) recommends employers avoid asking for this information on an application form. If and when you do ask about convictions later in the selection process, the inquiries should be job-related and consistent with business necessity.

Q: Can I ask, during an interview, or at the time of onboarding, if candidates have any garnishments? If they answer yes, can I refuse to hire them?

A: Title III of the Consumer Credit Protection Act (CCPA) expressly prohibits an employer from discharging an employee whose earnings have been subject to garnishment for any one debt. Some states have greater protections for workers. Additionally, keep in mind federal, state, and local nondiscrimination laws since screening applicants based on garnishments could have a disproportionate effect on a protected class (such as race, color, national origin, religion, or sex).


Q: Do hairstyle discrimination laws apply to all races?

A: In the past few years, several states and local jurisdictions have enacted laws expressly prohibiting employers from discriminating against applicants and employees because of hair texture and hairstyles that are historically associated with race. These hairstyles include but aren’t limited to braids, locks, and twists and the laws aren’t limited to a specific race.

Grooming and appearance standards must comply with federal, state, and local nondiscrimination laws. To avoid potentially discriminatory practices, consider simply requiring employees to keep hair kempt. However, conscious, and unconscious biases may impact what decision-makers view as “kempt,” and some may wrongly presume that certain hairstyles are inherently messy or disorderly. Clarify that kempt means that the hair is clean and well combed or arranged, and that employees can comply with a variety of hairstyles, including but not limited to locks, cornrows, and Afros that meet those criteria.

Q: Can a workplace require that employees’ hair be pulled back for safety reasons?

A: Where an employer has legitimate health or safety concerns, they may consider hair ties, hair nets, head coverings, and alternative safety equipment and should be consistent in enforcing such rules.



Make sure your pay practices, hiring practices, and grooming and appearance standards comply with federal, state, and local laws.





Source:  ADP


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6 Exit Interview Best Practices: Tips and Precautions

People aren’t usually great at goodbyes, and work is no exception. Sometimes, you’re sad to see employees go because they are talented, and you care about them personally. Other times, you might be relieved that they’re moving on to pastures you don’t have to shepherd. Either way, it’s crucial to treat these transitions with care, and an exit interview can be a great way to leave the relationship in the best place possible.

What is an Exit Interview?

While specifics vary widely between organizations, industries, and job types, a basic exit interview can be conducted in a variety of methods.

Any activity that allows an organization to exchange information with someone before their departure.

 Some common ways to conduct an employee exit interview include:

  • One-to-One Discussion: Because of the high importance of exit interviews, this method is the most ideal and common. A one-to-one discussion gives the interviewer the opportunity to ask useful follow-up questions, gain an understanding of how employees feel about the organization, and ideally leave the relationship as positive as possible.
  • Survey: If your organization has a lot of temporary or seasonal employees who leave in a mass exodus, an online survey might be the best way to conduct employee exit interviews. While certainly less personal, this method is better than not conducting exit interviews at all.

 What is the purpose of an exit interview?

An exit interview provides an opportunity for the organization to seek feedback about an employee’s experience. Gathering feedback can help organizations identify areas for improvement and reduce future turnover.

What are the benefits of conducting exit interviews?

Especially considering the relatively small investment (30 minutes to an hour is all it takes), there are plenty of benefits to conducting exit interviews:

  • Genuine Feedback: As mentioned above, the most obvious purpose of exit interviews is to gather feedback. Hopefully, employees feel safe providing feedback throughout their employment without it negatively impacting their jobs. But the great thing about a departing employee is they don’t have much to lose by speaking their mind. So, ask the tough questions.
  • Amicable Parting: Whether your employee is leaving because of their choice or yours, they’re still people who deserve respect. An exit interview might not be able to correct every less-than-satisfactory experience, but it can certainly help.
  • Employment Wrap Up: An exit interview is a perfect place to ensure employees understand any lingering obligations like equipment returns, non-competes, intellectual property agreements, etc.
  • Q&A: You might not be the only one with questions either; your employee might have a few things they’d like answered, too. Whether they’re looking for answers on setting up COBRA insurance or why they were passed up for a promotion last year, an employee exit interview can provide a lot of clarity.
  • Private Venting: People need to be heard. If you don’t give your employee the opportunity to share feedback privately before they leave, they may find ways to do it more publicly after they’re gone. Whether that means spreading their experience by word of mouth or leaving a scathing Glassdoor review, you’ll be much better off if you can help employees get things off their chest before they walk out the door.

Exit Interview Best Practices & Tips:

It can be tough to know exactly how to conduct an exit interview. While we can’t tell you what to say in an exit interview since each organization and each employee is different, we can provide some exit interview best practices:

  •  Schedule the meeting and clearly communicate the purpose. An employee’s last day is typically the best time to conduct an exit interview. In fact, it might even be a good idea to have it be the very last thing they do before heading on to their next adventure. It should be scheduled well ahead of the last day so your employee can be prepared. You should also provide an explanation or agenda of exactly what you’ll be discussing so that departing employees know you understand the importance of exit interviews. You’ll also enable them to provide more thoughtful answers to your questions by giving them time to think through what you’ll be talking about.
  • Have someone other than the employee’s direct manger conduct the interview. Even the best managers have areas of improvement. Your departing employee may not feel entirely comfortable giving open, honest feedback about all their experiences to someone who was likely involved with those experiences.
  • Outline appropriate (and useful) questions. Instead of rushing into the meeting and letting your intuition guide the conversation, take time in advance to outline the specific questions you’d like to ask. Knowing a bit about the employee’s specific circumstances might change what you want to ask.
  • Express excitement and support for their new opportunity. It’s a bummer when top performers leave, but if you genuinely care about employees (and you should!), you should be excited that they’re taking on new challenges. Where appropriate, express how much you and the company appreciate their contributions and how excited you are for their new journey.
  • Implement the feedback. This is perhaps the most important tip of all. The information you gather in exit interviews won’t do you any good if you don’t do anything with it. Take advantage of the full value of exit interviews by carefully recording and implementing the feedback. Of course, not all feedback will require action (sometimes situations are isolated or departing employees simply vent frustrations), but when you notice patterns or large issues, create a plan to start taking action immediately.

 Exit Interview Precautions:

As with many HR tasks, exit interviews should be approached carefully. Even employees you perceive as leaving with goodwill may be looking for any opportunity to gather a little dirt, and since it’s likely the last interaction your employees have, it’s a good idea to ensure you end on a positive note.


  • Keep it positive. It can be easy to take a defensive stance when someone is providing a lot of feedback (let alone criticism). Your organization wants the feedback, and the exit interview isn’t the place to refute any criticisms—whether the criticism is fair or not. Tell your inner debate champion to take a lunch break, listen, and try to steer the conversation to a constructive place by pushing for details that will help you make impactful changes.
  • Don’t overshare. Especially if you’re friends with the leaving employee, it can be tempting to respond to exit interview feedback with a bit of insider information. (e.g., “Between you and me, you’re not the only one to report that behavior from her.”) It’s especially important to ensure you walk the line and don’t let anything slip in the exit interview that could create any legal risk for the company.
  • Don’t force it. You may have employees who don’t want to do an exit interview at all. Bummer for you, but don’t force them. It’ll leave a sour taste in their mouth and likely won’t result in anything productive. If you have paperwork they need to sign or procedures they need to complete, swing by their desk or office and give them a task list with due dates. Then check in as their final day approaches to ensure all your offboarding ducks are in a row.


Before your employees walk out the door for the last time, ensure you’ve done everything you can to learn from them and leave the relationship in an amicable place. When done carefully, exit interviews provide a lot of benefits for your company and your departing employee. If nothing else, it provides an opportunity to wrap up any final to-dos and say goodbyes.

SOURCE:  Brian Anderson

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Company Culture and the Employee Experience

Company culture has a lot to do with employee experience, and vice versa. In fact, they are essential to each other’s success: a great company culture fosters a great employee experience, and a great employee experience both reflects and fuels a great company culture. Together, they can lead to valuable business benefits like increased productivity, reduced turnover, and greater employee satisfaction.

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10 Favorite Phone Interview Questions

Let’s face it: Phone screenings can be challenging. More often than not, it’s your first opportunity to have an in-depth discussion with your candidates, and there’s a lot of ground to cover in a short period of time.

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Effective Employee Exit Interview Questions

Are Employee Exit Interview Questions Actually Important?

While negative feedback can be hard to take, employees who are willing to share their genuine thoughts can be invaluable resources for improving your organization. After all, the core purpose of an exit interview is to gather honest feedback that your organization can then use to make changes and improve the employee experience.


Poor exit interview questions and strategies often get in the way of this honest exchange happening. As a result, organizations are losing out on the opportunity to improve the employee experience and boost retention. But with the right questions and the proper approach to the conversation, you can find gems of useful feedback within an employee’s answers.

 Asking the Right Exit Interview Questions

The questions you ask during an exit interview should encourage honest, in-depth responses from the employee. Ask them with an open mind, regardless of the circumstances surrounding the employee’s departure, and don’t be afraid to ask follow-up questions for clarification. Below are some ideas for your own employee exit interview questions template. We’ve found this list to be the most effective exit interview questions to ask.

 Reasons for Leaving

  1. Why did you begin looking for another job?
  2. If you could change anything about the organization, what would you choose?
  3. Did you voice your concerns to anyone else at the company?


  1. Did you think your work goals and responsibilities were clear?
  2. Did you feel you had all the resources you needed to do your best work here?
  3. What did you think of the way you were managed?
  4. Did you receive frequent, constructive feedback from your manager and peers?
  5. What benefits or programs did you feel were missing from the organization?
  6. How would you describe the culture of our company?
  7. What did you appreciate most about working here?
  8. Is there anything we could have done to make you want to stay?

 Looking Ahead

  1. What are the biggest risks for our company that you see?
  2. What advice would you like to give to your team? To the executive team?
  3. What would make this a better place to work?
  4. Would you ever consider working here again?
  5. Would you recommend others apply for a position here?

How to Conduct the Exit Interview

Whether you decide to ask all or only some of these questions, it’s vital to approach exit interviews with the right mentality and a defined plan of action. According to Harvard Business Review, exit interviews depend upon two elements to be effective:

1) The employees’ honesty & forthrightness

2) The organization’s willingness to change

Let’s discuss honesty first. Employees who leave your organization may not express their true thoughts for a variety of reasons. If employees leave on negative terms, they may be unwilling to offer their feedback because they have a “good riddance” attitude. Others may be worried about burning bridges with former managers. In that same HBR article, an HR professional at a European mining company explained, “Are they really going to tell you they’re leaving because they don’t like their boss? Probably not, because they want references.”

The best tips for conducting such interviews:

  • Make the experience as positive as possible.
  • The interviewee should feel like you have their best interests in mind—personal development above company interests.
  • Help the interviewee feel completely free and encouraged to give candid input without repercussion.
  • Be grateful for the perspective and for the relationship. Even though this is an exit interview, it’s not an exit interview for the professional relationship. You never know who you’ll end up working with again.
  • Treat them, for the moment, like an expert on your business. Listen authentically.

Once you’ve set the right tone and encouraged honest employee feedback, it’s up to you and your organization to do something about it. HBR’s research revealed that, when asked for examples of a specific action taken as the result of an exit interview, fewer than one-third of executives could identify one. That means about “two-thirds of existing programs appear to be mostly talk with little productive follow-up.”

While it might not matter to former employees what actions your organization did or did not take based on their feedback, it certainly matters to the employees who are with your organization right now. If an employee leaves your organization because of a specific pain point (toxic culture, lack of learning and development opportunities, non-challenging work, etc.) it’s likely that another employee who’s still with your company is also dissatisfied. Unless you address these pain points, it’s only a matter of time before that employee leaves as well—after explaining their reasons to their coworkers. If your organization earns an uncaring reputation, you can get stuck in a cycle of turnover.

To break out of the cycle and boost retention, listen carefully during exit interviews, analyze the results, and look for trends. Have several people complained about the same thing? Make a note of it and follow up with your current employees to learn how to improve their experience.


Employee exit interviews were designed to be a valuable tool to help organizations improve. By asking strategic questions and approaching employees with the right attitude, you can discover the true value of an effective interview once more. Try some of these questions next time to get the most out of your exit interview.

SOURCE:  Tori Fica

Sr. copywriter BambooHR

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