A salary is a fixed amount paid for each pay period regardless of the exact hours worked. Under federal law, it also comes with rules about when pay can and cannot be reduced.
Under the federal rule at 29 CFR 541.602, an exempt employee must receive the full salary for any week in which they do any work, subject to a short list of exceptions. Deductions can be made when the employee is absent for one or more full days for personal reasons. Deductions for a partial-day absence generally are not allowed: in the regulation’s own example, an employee absent for a day and a half can be docked only for the one full day.
To total hours with breaks and overtime, use our time card calculator.
Salaried non-exempt employees are different. They receive a salary but are still owed overtime, so their hours have to be tracked like anyone else’s. See salaried non-exempt.
An exempt office manager earns $1,000 a week, or $200 a day on a five-day week. In one week she leaves at noon on Tuesday for a personal appointment and takes Thursday off for a personal day, without leave available. The employer may deduct $200 for the full day on Thursday. It may not deduct the half day on Tuesday from her salary. Her pay for the week is $800.
The employer can still ask her to use PTO for the Tuesday afternoon if its leave policy allows, because that reduces a leave balance rather than her salary. Docking the half day from pay would put the exemption itself at risk.
In restaurants, retail and field service, salaried roles are usually managers and supervisors. Two problems come up again and again. First, a salaried assistant manager who spends most of the shift doing the same work as the hourly team may not meet the duties test, which means overtime could be owed. Second, a salary that sits close to the threshold can be pushed below it by a pay cut or a change from full-time.
Tracking when salaried supervisors start and finish, even if it does not drive their pay, gives you the facts if an exemption is ever questioned.
To compare a salary with an hourly rate, divide the yearly salary by the hours it is meant to cover. For a 40-hour week, that is 2,080 hours a year, so a $52,000 salary is $25 an hour. The salary to hourly calculator does the conversion for other schedules.
Salaries can change, but the change should apply going forward, be confirmed in writing, and follow any state rule on notice of pay changes. For an exempt employee, the new salary must still meet the salary level, and it should not move up and down from week to week with the amount of work available, which would break the salary basis.
A shift lead earning $22 an hour usually works about 45 hours a week, so her typical weekly pay is 40 x $22 + 5 x $33 = $1,045.
She is promoted to assistant manager on a $1,000 weekly salary and classified as exempt. Before the change, the company checks that her new duties meet the executive duties test and points out that her weekly pay will be slightly lower than in her typical overtime weeks. It raises the offer to $1,100 a week so the promotion is also a raise, and confirms it in writing.
The DOL lists the standard salary level for the federal white-collar exemptions as $684 per week, equivalent to $35,568 a year. Several states set higher thresholds, and the employee must also meet a duties test.
Salaried non-exempt employees do. Salaried exempt employees do not, if they meet both the salary and duties tests.
For exempt employees, only in limited cases, such as full-day absences for personal reasons. Partial-day deductions generally break the salary basis.
It depends on the job. Salary gives a predictable check; hourly pay rewards every extra hour. See wage vs. salary for a side-by-side comparison.
Divide the yearly salary by the hours it covers. For a 40-hour week, divide by 2,080, so $52,000 is $25 an hour.
Generally yes, going forward, with notice where state law requires it. For exempt employees the salary must stay above the threshold and should not vary with the work available each week.
EZTime turns clock-ins and approved corrections into signed monthly reports you can export to PDF or Excel for payroll.