Exempt vs. Non-Exempt; Minimum Wage Increases and NY State Salary Threshold Increase 2022
March 25, 2022

Updated 3/25/2022


This article explains how to pay employees, as well as the new minimum wage that went into effect back on 12/31/2021. Non-compliance with the information could lead to repercussions during a DOL audit.

 

The New York State Department of Labor late last year published final rule regarding the increased salary thresholds to be considered exempt from overtime as well as changes to the minimum wage schedule.
 
Under both federal and New York law, employers must pay non-exempt employees at least the minimum wage for each hour worked and 1.5 times their regular rate of pay whenever they work more than 40 hours in a workweek. While most employees must be classified as non-exempt, federal, and state law include exemptions from the minimum wage and overtime requirements for certain employees, including bona fide professional, administrative, and executive employees.
 
Remember, it is not enough to simply pay an employee what an “Exempt” employee is supposed to receive and expect that employee to be classified as EXEMPT. They have to meet the criteria:
 
•  Must be paid equal to the requirements set forth for the Exempt Qualifications (i.e. Administrative, Professional, Executive)
•  Paid on a Salary Basis (Paid a Salary each pay period regardless of the hours they work. * with limited exceptions)
•  Must meet the Job Duties Test for their position
 
If they do not meet ALL THREE of these criteria, then they can not be classified as exempt, and if an employer chooses to do so, an employer’s level of exposure to a Department of Labor Audit is greatly increased. The duties tests are further explained below.
 
Employees who meet the duties test under the Fair Labor Standards Act (FLSA) for executive and administrative exemptions must also meet the salary level requirements in New York in order to be exempt. New York’s exempt employee salary threshold will adjust annually in proportion to increases in the minimum wage. All rate changes will take effect on December 31st of each year.


Below is an overview of exemption tests under New York law.


Salary-Level Test (New York):


Administrative and Executive Exemptions:

For the administrative and executive exemptions, the minimum salary is 75 times the state minimum wage. The minimum salary differs based on where in the state the employee works.

 
Here are the minimum salary requirements currently in effect in New York:


NYC  $1125.00

Other NY counties (Outside of NYC)  $990.00
Remainder of Downstate (Nassau, Suffolk & Westchester counties)  $1125.00
As of 12/31/2021 – Other NY counties (Outside of NYC)  $990.00
As of 12/31/2021 – Remainder of Downstate (Nassau, Suffolk & Westchester counties)  $1,125.00


Professional Exemption:

For the professional exemption, there is no minimum salary requirement under NY State law, but the federal Fair Labor Standards Act (FLSA) has a minimum. In this case, most New York employers would be required to meet the FLSA's minimum salary requirement for the professional exemption (in addition to meeting the federal and state duties tests).
Currently, to qualify for the professional exemption under the FLSA, an employee must be paid a salary of at least $684.00 per week ($35,568 annually).
 

Salary-Basis Test:

New York generally follows federal rules for the salary-basis test. To qualify for the state and federal exemption, an employee must receive their full salary for any week in which they perform any work. Salary reductions are not permitted due to variations in the quality or quantity of the employee's work.


For exempt employees, salary deductions are limited to the following circumstances:

 

 • One or more full day absences for personal reasons other than sickness or disability.

 •  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.
Under federal and state rules, deductions from exempt employees' salaries for any other reason are prohibited.
 

Duties Test (New York):

New York's duties tests vary for each exemption and are slightly different than the federal duties tests.
 

Administrative Exemption:

To qualify for the administrative exemption under New York law:

 

•  The employee's primary duty must involve performing office or non-manual work directly related to management policies or the employer's general operations.
•  The employee must regularly exercise discretion and independent judgment; and
•  The employee must:


o  Regularly and directly assist the employer or an employee employed in a bona fide executive or administrative capacity; or
o  Perform, under only general supervision, specialized or technical work requiring special training, experience, or knowledge.


NOTE: To see who typically falls under the Administrative Exemption, see the attached Administrative Exemption PDF

 

Professional Exemption:

To qualify for the professional exemption under New York law, the employee's primary duty must consist of performing work that requires advanced knowledge in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study.


The employee's work must:


•  Require the consistent exercise of discretion and judgment.
•  Be predominantly intellectual and varied in character (as opposed to routine mental, manual, mechanical, or physical work); and
•  Be of such a character that the output produced cannot be standardized in relation to a given period.
•  NOTE: To see who typically falls under the Professional Exemption, see the attached Professional Exemption PDF


Executive Exemption:

To qualify for the executive exemption under New York law the:


•  Employee's primary duty must consist of the managing a customarily recognized department or subdivision of the enterprise.
•  Employee must customarily and regularly direct the work of two or more other employees.
•  Employee must have the authority to hire or fire other employees, or their suggestions and recommendations will be given weight; and
•  Employee must customarily and regularly exercise discretionary powers.
•  NOTE: To see who typically falls under the Executive Exemption, see the attached Executive Exemption PDF


An employee's "primary duty" is generally defined as the principal, main, major, or most important duty that the employee performs. The determination of an employee's primary duty must be based on all the facts in a case, with the major emphasis on the character of the employee's job.


Conclusion:

Before classifying employees as exempt from overtime, make sure that the employee satisfies the salary-level, salary-basis, and duties tests under both federal and state law. If an employee is covered by both the federal and state law but does not meet both sets of tests, consult with counsel and/or a CPA to determine how you should classify the employee in that situation.

Also note as of 12/31/2021:

The NY State minimum wage for Long Island and Westchester counties will increase from $14.00 per hour to $15.00 per hour


*Annual increases for the rest of the state will continue until the rate reaches $15 minimum wage (and $10 tipped wage). Starting 2022, the annual increases will be published by the Commissioner of Labor on or before October 1. They will be based on percentage increases determined by the Director of the Division of Budget, based on economic indices, including the Consumer Price Index.


The NY State minimum wage for counties outside of NYC will increase from $12.50 per hour to $13.20 per hour.

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Understanding Accent Discrimination in the Workplace: How Employers Can Lead with Inclusion

July 1, 2025
As organizations continue to grow and diversify, the way we communicate at work is evolving, bringing new opportunities for inclusion as well as potential blind spots. One issue that often goes overlooked is accent discrimination: the tendency to judge, exclude, or undervalue individuals based on their speech patterns, dialect, or pronunciation. While accents are often rooted in geography, heritage, or culture, bias toward or against certain ways of speaking can influence decisions in hiring, promotions, evaluations, and daily interactions. For employers, particularly those in small to mid-sized organizations, understanding where this shows up and how to respond isn’t just about creating a respectful workplace. It’s also essential for risk mitigation and legal compliance. What Constitutes Accent Discrimination? Accent discrimination occurs when employees or candidates are treated unfairly due to the way they speak. This type of treatment may stem from overt, conscious bias, such as assuming someone is less capable based on how they sound, or from more subtle, unconscious preferences, like favoring those who speak in what’s perceived as a “standard” or “neutral” accent. Legally, accent-based discrimination can be considered a form of national origin discrimination, which is prohibited under Title VII of the Civil Rights Act. Many states reinforce these protections through their own civil rights laws. Employers should be aware that even unintentional practices, such as informal communication preferences or subjective feedback, can result in compliance issues or reputational damage. Clear Communication vs. Discriminatory Practice It is important to distinguish between legitimate communication needs and bias. In certain narrowly defined circumstances, an accent may be relevant to an employee’s ability to perform essential duties. For instance, in roles that require precise, real-time verbal communication, such as emergency response or high-risk operational jobs, an employer may need to assess whether a language barrier or speech pattern materially interferes with safety or accuracy. However, such evaluations must be backed by objective evidence and a clearly defined business necessity. Vague discomfort, personal preference, or client feedback based on unfamiliarity are not valid reasons to deny someone an opportunity. Any decision related to an accent must be both job-related and supported by measurable performance impacts. Standardize Hiring and Promotion Processes to Minimize Bias One of the most effective ways to reduce the risk of discrimination is by formalizing your hiring and promotion practices. Employers should examine whether their processes allow room for bias (conscious or unconscious) to influence decisions. Subjective impressions, especially in interviews or internal evaluations, can be disproportionately shaped by how a person speaks. To counteract this, companies should move toward structured, competency-based hiring frameworks. Use consistent criteria and scoring systems across all candidates, and rely on written assessments or role-specific tasks where appropriate. Similarly, promotions should be guided by documented performance metrics, not informal perceptions of professionalism or communication style. In doing so, not only do you reduce the chance for bias to affect outcomes, but you also make better staffing decisions that reflect skills, qualifications, and organizational fit: not speech patterns. Why This Matters More Now In today’s hybrid and remote work environments, the ability to navigate diverse communication styles has become even more important. With teams collaborating across geographic regions and cultural backgrounds, inclusivity in communication is essential for morale, cohesion, and productivity. Moreover, younger workers and job seekers are placing a high value on belonging and inclusion. Discriminatory or exclusionary behavior, intentional or not, can quickly erode trust and lead to disengagement or turnover, especially when tied to identity-based characteristics like accent or dialect. Employers who lead with fairness in communication are more likely to attract and retain talent, maintain strong teams, and avoid costly compliance missteps. Building a Culture Where All Voices Are Valued Ultimately, embracing different accents in the workplace is about genuine, judgment-free listening. Employers should encourage active listening practices, create space for respectful clarification when needed, and ensure employees feel safe speaking up, regardless of how they sound. Miscommunication is a solvable issue. Discrimination is not. Leaders who prioritize clarity, fairness, and consistency, rather than conformity, build workplaces that are both inclusive and high-performing. And the benefits go beyond compliance. They create environments where people thrive because they are heard and valued.

Balancing Holiday Time Off Requests Without Slowing Down Your Business

June 30, 2025
Between Independence Day, summer travel plans, and Labor Day on the horizon, time-off requests are about to pick up significantly, and with good reason. Employees need time to recharge, spend time with family, and enjoy the season. For employers, especially in small to mid-sized businesses, this means finding the delicate balance between fostering a supportive work culture that respects employees’ need for time away and managing the practical realities of maintaining adequate coverage, meeting deadlines, and keeping operations running smoothly. The good news? With thoughtful planning, clear communication, and the right tools in place, you can navigate this busy season effectively, ensuring your team gets the rest they deserve without compromising business continuity. Here are a few practical strategies to help you manage PTO during the summer months while keeping your business running smoothly:  1. Plan Early and Communicate Clearly Encourage employees to submit holiday PTO requests well in advance. Set a clear internal deadline (e.g., “All holiday time-off requests must be submitted by August 15”) and explain the process upfront, including: How requests will be reviewed and approved How overlapping requests will be handled Any blackout dates or essential coverage periods A clear and consistent approach eliminates guesswork, reduces friction, and helps everyone feel they’re being treated fairly. 2. Use a PTO Policy That Balances Fairness and Flexibility Your time-off policy should include guidelines for high-demand periods like Thanksgiving, Christmas, and New Year’s. Some companies use: First-come, first-served approvals A rotation system so everyone eventually gets prime time off A seniority or department-based system with built-in equity checks Whatever method you choose, consistency is key. A well-documented policy gives managers a framework to follow, and gives employees peace of mind that decisions are made justly, not arbitrarily. 3. Leverage Your HCM or Scheduling Technology If you're using a system like isolved , you already have powerful tools to streamline the PTO process. Automate request tracking, visualize department coverage in real time, and flag conflicts early to avoid blind spots. This gives HR and team leads the visibility they need to make smart, timely decisions. Bonus tip: Use system alerts to notify managers when coverage is thin, or configure it to close PTO windows automatically after a set date. These features take manual work off your plate while protecting productivity. 4. Cross-Train and Create Holiday Coverage Plans Rather than scrambling when someone’s out, prepare your team to adapt. Cross-train employees in advance so they can cover essential tasks if a teammate is unavailable. Before the busy season kicks in, put together a simple holiday coverage plan that outlines: Who will monitor essential tasks (client inquiries, payroll processing, etc.) What needs to get done and by whom each week Who’s available for backup support if needed A little upfront planning makes a big difference in keeping service levels steady during staff absences. 5. Appreciate Those Who Step Up Don’t let holiday contributions go unnoticed. Employees who work through the holidays or shift their schedules to ensure coverage deserve meaningful recognition. Consider: Spot bonuses or incentives Public recognition in a team meeting or internal email Additional time off (comp time) after the holidays Even small gestures show your team that their flexibility and dedication are valued, and that you see the extra effort. 6. Set Expectations With Clients (and With Your Team) If your operations will run on limited hours or staffing during the holidays, notify clients and partners well in advance. Clear communication avoids surprises and sets realistic expectations. Internally, define what’s essential versus what can wait, especially to avoid employees overworking during slower periods. When everyone understands what’s expected, your team can better prioritize, delegate, and breathe a little easier during the season. Final Thought: Flexibility Builds Loyalty The holiday season is a test of your workplace culture. How you support your team, especially when juggling competing needs, leaves a lasting impression. Even when saying no to a request, doing so with empathy and transparency reinforces a culture of trust, fairness, and respect. And in return, you'll see greater engagement, improved morale, and a team that’s ready to go the extra mile — during the holidays and beyond. Need help building better time-off workflows or updating your PTO policies before year-end? Simco’s HR and HCM experts are here to help. Let’s talk about how to balance compliance, efficiency, and employee satisfaction, all year round.

How Employers Can Support Working Parents This Summer

June 2, 2025
When school lets out, many working parents face a new set of challenges: piecing together childcare, coordinating summer camps, adjusting work schedules, and simply trying to maintain a sense of balance. For employers, this season presents a valuable opportunity to demonstrate empathy and build stronger connections with your workforce—especially your working parents. By offering the right policies, benefits, and workplace flexibility, your company can help parents manage the summer shuffle—while keeping productivity and morale strong. Here are a few impactful ways to make that happen. 1. Offer Flexible Scheduling Options Summer schedules are rarely predictable, especially for parents with younger children or teens involved in day camps, sports, or part-time jobs. Allowing employees to shift their working hours or compress their workweeks can be a game-changer. Early start and end times, four-day workweeks, or staggered hours give parents the flexibility to handle family logistics without sacrificing their jobs. What you can do: Encourage managers to have open conversations with team members about their summer availability. Promote cross-training so employees can support each other during flexible hours or time off. Formalize a “Summer Flex Hours” program to show company-wide support. This kind of trust-driven flexibility not only improves work-life balance but also boosts engagement and retention. 2. Revisit Your Remote or Hybrid Work Policy For companies that support remote work, summer is an ideal time to offer extra flexibility. Parents may need to be closer to home for child supervision or to avoid time-consuming commutes during camp drop-offs and pickups. Even one or two remote days per week can ease the mental load on parents—helping them stay focused and productive during working hours. And it signals a deeper commitment to employee wellbeing. Ways to implement: Offer a seasonal “summer remote work option” if your company is traditionally office-based. Empower department heads to tailor remote work flexibility to their team’s needs. Reinforce accountability and results-based performance to support this model. Tip: Simco is happy to help you review your remote work policy for both compliance and employee satisfaction! 3. Promote and Educate on Dependent Care Benefits Many organizations offer dependent care support, but employees often forget—or aren’t aware—of what’s available. Summer is a perfect time to highlight programs like: Dependent Care FSAs (tax-free childcare reimbursements) Childcare subsidies or stipends Backup care assistance Employee Assistance Programs (EAPs) with parenting or caregiver resources Tip: Create a simple “Summer Benefits Guide” or a quick email campaign highlighting available benefits. If your team uses a digital portal or app, make sure this information is easily accessible and up to date. 4. Plan Ahead for PTO and Team Coverage Summer means vacations—and for working parents, this might be the only chance they get to spend extended time with their families. That’s why it’s crucial to encourage early vacation planning and transparent communication among teams. Strategies to support summer PTO:  Ask employees to submit summer PTO requests as early as possible. Use shared calendars and collaborative tools to coordinate team coverage. Train back-up team members ahead of time to avoid last-minute stress. Consider adding a floating summer holiday or mental health day to give employees a breather. When employees feel supported in taking time off, they’re more likely to return refreshed and ready to re-engage. 5. Build a Family-Friendly Workplace Culture Supporting working parents isn’t just about policies—it’s about creating a culture of empathy and understanding. That starts with leadership modeling flexibility, and continues with teams who respect boundaries and accommodate personal obligations. Ideas to build culture: Create a parent resource group or Slack channel to exchange ideas and support. Share local summer camp or childcare resources in your company newsletter. Avoid scheduling late afternoon meetings that may interfere with family commitments. Celebrate family milestones or kid-friendly moments in a light-hearted way. These small cultural cues can go a long way in helping working parents feel seen, supported, and valued—especially during a season that’s often more stressful than relaxing. Final Thoughts Supporting working parents through summer break isn’t just the right thing to do—it’s a smart business strategy. Offering flexibility, benefits education, and an understanding culture helps companies retain top talent, foster loyalty, and create a healthier workplace for all. Need Guidance? At Simco, we specialize in helping businesses implement people-first policies and scalable benefit solutions. If you’re looking to enhance your workplace support for parents (or all employees), our specialists are here to guide you! Let’s talk about how we can help your workforce thrive—this summer and beyond.

Have a question? Get in touch.