The post HR Update: October 21st, 2026 appeared first on Your HelpDesk for HR .

Hey Bosses!

Are you ready to tackle some of the biggest HR and payroll challenges facing employers today?

I’ve put together an incredible lineup of 6 Boss Calls designed to help you stay compliant, avoid costly mistakes, and confidently handle the everyday (and not-so-everyday!) challenges that land on your desk.

From AI and employee accommodations to payroll pitfalls and problem employees, we’re covering the topics that keep HR professionals and business owners up at night.

And the best part? Every Boss Call is packed with practical guidance, real-world examples, and actionable takeaways you can put to work immediately!

Your Upcoming Boss Calls Lineup

1. AI in HR: What Employers Can (and Can’t) Do Legally
Date: 10/28/26

AI is changing HR faster than most employers can keep up! Learn how to use AI responsibly while avoiding discrimination risks, privacy concerns, and compliance mistakes.

2. Payroll Compliance Landmines: 10 Mistakes That Cost Employers Big Money
Date: 11/10/26

Think your payroll practices are airtight? Let’s find out! We’ll uncover common payroll mistakes involving overtime, deductions, bonuses, and final paychecks that could cost your organization thousands.

3. FMLA, ADA & PWFA: Navigating the Accommodation Maze

Date: 11/18/26

When medical leave, disability accommodations, and pregnancy protections overlap, things get complicated FAST! Learn how to navigate these laws, manage the interactive process, and avoid costly compliance mistakes.

4.  Payroll Changes for 2027: Overtime, Tips, Taxes & Reporting Requirements

Date: 12/2/2026

New year, new payroll challenges! We’ll cover the latest applicable payroll developments, including qualified overtime and tip reporting, tax changes, and what employers should prepare for in 2027.

5. The Problem Employee Playbook: Handling Attendance, Attitude & Performance Issues
Date: 12/16/26

Every HR professional has dealt with THAT employee. You know the one! Let’s talk about handling attendance problems, poor performance, insubordination, and difficult behaviors while keeping your organization protected.

Just 60 Minutes. Tons of Practical HR Knowledge.

Each Boss Call is designed to help you:

Understand important HR and payroll compliance requirements.

Identify costly mistakes before they become bigger problems.

Apply practical solutions to real workplace situations.

Walk away with action steps you can use right away.

Get answers to your HR and payroll questions during our live Q&A!

HelpDesk for HR Members — You’re Invited!

All 5 Boss Calls are included with your HelpDesk for HR membership at no additional charge!

[REGISTER FOR YOUR BOSS CALLS HERE]

Not a member of HDHR? You’re welcome to join us, too!

$49 (reg. $199) 

Email Support@helpdeskforhr.com to receive the registration link

Whether you’re an experienced HR professional, a payroll specialist, or a business owner wearing about 47 different hats, these sessions are designed to help you make smarter decisions and stay one step ahead.

I can’t wait to see you at the next Boss Call!

Lisa Smith, SPHR, SHRM-SCP
HelpDesk for HR
Practical HR Guidance for Real-World Employers

The post The 2026 End of the Year Schedule for Boss Calls Has Been Posted! appeared first on Your HelpDesk for HR .

Employee benefits can be one of the most valuable parts of an organization’s compensation package.

Health insurance, retirement programs, dependent coverage, and other benefits help employers attract and retain employees.

But administering these programs involves much more than enrolling employees and processing payroll deductions.

A missed deadline, incorrect eligibility determination, or overlooked notice can expose employers to compliance problems and unexpected expenses.

For HR and payroll professionals, understanding the most common benefits mistakes is an important part of managing organizational risk.

Mistake #1: Misunderstanding ACA Employer Requirements

Under the Affordable Care Act (ACA), applicable large employers generally include organizations averaging at least 50 full-time employees, including full-time equivalent employees, during the preceding calendar year.

These employers may be subject to employer shared responsibility and information reporting requirements.

Employers sometimes overlook part-time employee hours when determining applicable large employer status.

Others fail to consider the rules for related companies that must be evaluated together.

Best practice: Review workforce counts annually, maintain accurate employee hours, and coordinate ACA reporting responsibilities between HR, payroll, and benefits administrators.

Mistake #2: Missing COBRA Notices or Deadlines

COBRA generally applies to group health plans sponsored by private-sector employers with 20 or more employees, subject to applicable counting rules.

When employees or covered dependents experience certain qualifying events, employers and plan administrators may have specific notice and continuation coverage responsibilities.

Missed notices or administrative errors can create significant problems.

Smaller employers should also review applicable state continuation coverage laws.

Best practice: Establish written procedures for identifying qualifying events, communicating with plan administrators, and tracking required notices.

Mistake #3: Making Incorrect Payroll Deductions

Employee benefit deductions must be administered consistently with applicable laws, plan documents, and employee elections.

Errors can occur when employees change coverage, experience qualifying life events, or terminate employment.

Pretax deduction arrangements also require compliance with applicable tax rules.

Best practice: Reconcile benefit elections with payroll deductions regularly and investigate discrepancies promptly.

Mistake #4: Mishandling Employee Eligibility

Benefits eligibility may depend on employee status, hours worked, waiting periods, plan provisions, and applicable legal requirements.

An employee’s promotion, reduction in hours, leave of absence, or employment status change can affect eligibility.

However, employers cannot assume every employment change automatically permits an immediate coverage change.

Best practice: Review eligibility provisions in plan documents and coordinate employment changes with benefit administrators before modifying coverage.

Mistake #5: Overlooking Required Notices and Documentation

Benefit plans may involve required disclosures, notices, reporting obligations, and document retention requirements.

Depending on the employer and plans involved, these can include summary plan descriptions, ACA forms, COBRA materials, and other legally required communications.

Failure to maintain accurate records can make resolving employee disputes particularly difficult.

Best practice: Maintain a benefits compliance calendar identifying deadlines, responsible individuals, and documentation requirements.

What Should Employers Do Next?

Schedule an annual benefits administration review.

Include HR, payroll, finance, and benefits advisors to verify employee eligibility, payroll deductions, required notices, plan documentation, and reporting processes.

Investigate discrepancies before they create larger problems.

Employers should also evaluate applicable state requirements and any relevant legal developments affecting the upcoming plan year.

The Bottom Line

Strong benefits administration requires careful coordination between HR, payroll, and outside service providers.

Employers that establish clear procedures, conduct regular reviews, and maintain accurate documentation are better positioned to reduce compliance risks.

Great employee benefits are valuable. Administering them correctly is essential.

Lisa Smith, SPHR, SCP

The post Benefits Compliance: Five Costly Mistakes HR and Payroll Professionals Should Avoid appeared first on Your HelpDesk for HR .

Hiring independent contractors can be an excellent way for businesses to access specialized skills, manage project costs, and maintain workforce flexibility.

But there’s a problem: Just because someone receives a Form 1099 doesn’t mean they’re legally an independent contractor.

Worker misclassification continues to create significant risks for employers, including unpaid overtime, employment taxes, penalties, employee benefit claims, and potential legal action.

And with federal rules continuing to evolve, this is an area HR and payroll professionals cannot afford to ignore.

What Actually Determines Worker Classification?

Worker classification depends on the realities of the working relationship, not simply the title or agreement assigned to the worker.

Under federal law, several agencies evaluate worker status for different purposes.

The Department of Labor evaluates employment relationships under the Fair Labor Standards Act (FLSA), while the IRS applies its own common-law standards for federal employment tax purposes.

States may impose additional requirements, sometimes using stricter classification tests.

Consequently, a worker might be evaluated differently depending on which law applies.

In February 2026, the Department of Labor proposed changes to its independent contractor regulations. Employers should distinguish proposed standards from binding legal requirements and verify the applicable rules before making classification decisions.

The Independent Contractor Warning Signs

Consider a business that hires a marketing consultant as a contractor.

The consultant works exclusively for the company, follows a fixed daily schedule, uses company equipment, reports directly to a supervisor, and performs essentially the same duties as regular employees.

The company issues a Form 1099-NEC and assumes everything is fine.

Not so fast!

Depending on the applicable legal tests, these circumstances could suggest an employment relationship.

Some important considerations include:

• The degree of control over how work is performed.
• The worker’s opportunity for profit or loss.
• Whether the worker operates an independent business.
• The permanence of the relationship.
• The worker’s investment in tools and equipment.
• Whether the services are integral to the business.
• The level of specialized skill and independent business initiative involved.

The relevance and weight of these considerations depend on the applicable test.

Best Practices for HR and Payroll Professionals

1. Audit contractor relationships. Identify all individuals receiving nonemployee compensation and examine their actual working arrangements.

2. Review applicable laws. Federal wage-and-hour, federal tax, and state classification standards may differ.

3. Use written agreements appropriately. Contracts should describe the relationship accurately, but cannot override legal requirements.

4. Avoid treating contractors like employees. Review supervision, scheduling, equipment, training, and operational practices for inconsistencies.

5. Reevaluate long-term arrangements. Relationships can evolve, and a worker’s classification may need to change.

What Should Employers Do Next?

Create a centralized contractor review process involving HR, payroll, finance, and legal counsel when appropriate.

Before engaging a contractor, document the applicable classification analysis and retain supporting information.

Review existing arrangements periodically, especially when responsibilities or working conditions change.

If potential misclassification is identified, obtain guidance before implementing corrections or changing reporting practices.

The Bottom Line

Independent contractor status isn’t established by a 1099, an invoice, or a signed agreement.

It depends on the applicable legal standards and the actual working relationship.

When it comes to worker classification, substance matters more than paperwork.

Lisa Smith, SPHR, SCP

The post Employee or Independent Contractor? The 1099 Classification Trap appeared first on Your HelpDesk for HR .

Domestic violence is often viewed as a private matter—something that happens behind closed doors and outside the workplace.

But here’s the reality: Domestic violence doesn’t always stay at home.

Employees experiencing domestic violence may bring the emotional, physical, and financial effects of abuse to work every day. In some cases, abusive partners may even threaten, stalk, harass, or confront employees at their workplace.

For employers, recognizing and appropriately responding to domestic violence isn’t just about compassion. It’s about workplace safety, employee well-being, and understanding important legal responsibilities.

Recognizing the Warning Signs

HR professionals and supervisors are not expected to diagnose domestic violence or investigate employees’ personal relationships. However, recognizing potential warning signs can help employers respond appropriately.

Possible indicators include:

• Unexplained injuries or repeated explanations for physical injuries.
• Frequent absences, tardiness, or sudden attendance problems.
• Noticeable changes in performance, concentration, or behavior.
• Excessive phone calls, texts, or interruptions from a partner.
• An employee appearing fearful or anxious about leaving work.
• A partner repeatedly showing up at the workplace or attempting to monitor the employee.
• Sudden financial difficulties or unusual requests involving payroll or direct deposits.

Important: None of these behaviors proves that domestic violence is occurring. Employers should avoid assumptions, intrusive questioning, or pressuring employees to disclose personal circumstances.

Why Domestic Violence Is a Workplace Concern

Domestic violence can affect employee attendance, productivity, concentration, and overall well-being.

More importantly, it can create genuine safety risks.

An abusive individual may attempt to contact an employee through company systems, appear unexpectedly at the workplace, or threaten coworkers who intervene.

OSHA recognizes workplace violence as including threats, intimidation, harassment, and physical violence. Employers have workplace safety obligations that may become relevant when threats or recognized hazards arise.

Ignoring a credible threat simply because it originates from an employee’s personal relationship can place employees and others at risk.

Understanding Employer Legal Responsibilities

Several federal and state employment laws may apply when an employee experiences domestic violence.

Workplace safety: Employers should evaluate credible threats and implement appropriate safety measures.

Employment discrimination: Federal antidiscrimination laws may prohibit employment decisions based on unlawful stereotypes concerning survivors. The ADA may also apply when an employee has a qualifying disability arising from abuse.

Protected leave: Certain medical conditions resulting from domestic violence may qualify for FMLA leave when eligibility requirements are satisfied.

State and local protections: Some jurisdictions provide specific domestic violence or safe leave protections, reasonable accommodation rights, confidentiality requirements, or restrictions on adverse employment actions.

Employers should review applicable laws before making decisions involving attendance, accommodations, or discipline.

Six Best Practices for Employers

1. Establish a workplace violence prevention policy.

Clearly prohibit threats, intimidation, stalking, harassment, and violence involving employees, visitors, or other individuals.

2. Train managers to recognize and respond appropriately.

Supervisors should know how to identify potential safety concerns, approach employees respectfully, and promptly involve HR or designated safety personnel.

3. Respect employee privacy.

Discuss concerns privately, share information only with individuals who have a legitimate need to know, and avoid promising absolute confidentiality when safety or legal obligations require disclosure.

4. Develop individualized workplace safety plans.

Depending on the circumstances, appropriate measures might include modified schedules, screening calls, restricted building access, security escorts, or emergency response procedures.

5. Provide access to resources.

Offer Employee Assistance Program information, local advocacy services, and confidential domestic violence support resources when available.

6. Avoid automatically penalizing survivors.

Before taking disciplinary action related to attendance or performance, evaluate whether protected leave, reasonable accommodations, or other legal protections may apply.

What Should HR Professionals Do Next?

Start by reviewing your organization’s workplace violence prevention procedures.

Determine whether employees have a safe and confidential way to report threats or request assistance.

Train managers on how to respond without making assumptions or attempting to act as counselors.

Coordinate with security personnel when necessary, and establish procedures for responding to credible threats or workplace emergencies.

Finally, review applicable state laws and identify community resources that can assist employees experiencing domestic violence.

Remember, an employer’s role is not to solve an employee’s personal relationship problems. It is to respond appropriately to workplace risks, provide legally required protections, and connect employees with qualified support.

The Bottom Line

Domestic violence is a serious issue that can affect employees, their families, and the workplace.

Employers who recognize warning signs, respond with compassion, and establish clear safety procedures can make a meaningful difference.

A safe workplace isn’t just one where violence is prohibited. It’s one where employees know they can ask for help without fear of judgment or unnecessary retaliation.

Sometimes, a thoughtful response from HR can be the first step toward helping someone find safety.

• National Domestic Violence Hotline: Call 800-799-SAFE (7233), text START to 88788, or visit thehotline.org. Employees should use a safe device or communication method when seeking help if they believe their activities are being monitored.

• OSHA: Workplace Violence Prevention Guidance.

• U.S. Department of Labor: Workplace Violence Program and Domestic Violence Guidance.

• EEOC: Employment Discrimination Protections and Domestic Violence Resources

Need Help Strengthening Your Workplace Policies?

HelpDesk for HR provides practical guidance to help employers navigate sensitive employee situations, workplace safety concerns, and complex HR compliance responsibilities.

Lisa Smith, SPHR, SCP

The post Domestic Violence Doesn’t Stay at Home: Why Employers Must Recognize the Warning Signs and Take Action appeared first on Your HelpDesk for HR .

The post HR Update: October 15th, 2026 appeared first on Your HelpDesk for HR .

An employee tells her supervisor that she is pregnant and needs additional restroom breaks throughout the workday.

Another employee recovering from childbirth requests temporary lifting restrictions.

A third needs flexibility to attend prenatal medical appointments.

How should employers respond?

Under the Pregnant Workers Fairness Act (PWFA), many employers have specific legal responsibilities to consider these requests.

And here’s something important: Employees do not necessarily have to be disabled to qualify for pregnancy-related accommodations under the PWFA.

Understanding the Pregnant Workers Fairness Act

The PWFA took effect on June 27, 2023, and generally applies to private employers with at least 15 employees, along with covered public employers.

The law requires covered employers to provide reasonable accommodations for qualified applicants and employees with known limitations related to pregnancy, childbirth, or related medical conditions, unless doing so would impose an undue hardship.

The PWFA supplements existing protections under federal laws such as Title VII and the Americans with Disabilities Act.

Some state laws provide additional pregnancy accommodation protections, including requirements applicable to smaller employers.

What Are Reasonable Pregnancy Accommodations?

Depending on an employee’s circumstances and job responsibilities, possible accommodations may include:

• Additional restroom, hydration, or rest breaks.
• Permission to sit or stand as needed.
• Temporary adjustments to lifting requirements.
• Modified work schedules.
• Time away from work for pregnancy-related medical appointments.
• Temporary changes to certain job duties.
• Leave for recovery from childbirth or related medical conditions.

Not every requested accommodation must be approved exactly as proposed.

However, covered employers generally must engage in an individualized process to identify an effective reasonable accommodation unless doing so would impose an undue hardship.

Common Mistakes Employers Should Avoid

Automatically placing pregnant employees on leave. An employee who can continue working with reasonable accommodations should not be unnecessarily forced out of the workplace.

Requiring excessive medical documentation. Employers should understand the limitations on when supporting medical documentation may be requested. Some accommodation requests require little or no documentation.

Assuming pregnancy accommodations are optional. The PWFA establishes affirmative accommodation responsibilities for covered employers.

Making decisions based on assumptions. Supervisors should not presume that pregnant employees cannot perform particular duties without evaluating the actual circumstances.

Ignoring retaliation protections. Employees must not be punished for requesting or using protected accommodations.

Best Practices for HR and Management

Begin by establishing a clear process for receiving and evaluating pregnancy-related accommodation requests.

Train supervisors to recognize requests even when employees do not mention the PWFA or use formal legal terminology.

Designate an HR representative or other qualified individual to coordinate the interactive process.

Document accommodation discussions, decisions, and any legitimate operational concerns.

When appropriate, consider temporary or interim accommodations while a request is being evaluated.

Finally, periodically review approved accommodations to determine whether adjustments remain effective.

What Employers Should Do Next

Review your handbook to confirm that pregnancy-related accommodations are appropriately addressed.

Examine leave, attendance, scheduling, and light-duty policies for provisions that could conflict with accommodation obligations.

Ensure managers understand that pregnancy accommodation requests should be referred promptly for appropriate review.

Employers should also check applicable state laws and monitor developments affecting the interpretation and enforcement of PWFA requirements.

The Bottom Line

Supporting pregnant and postpartum employees is not simply a matter of offering generous benefits.

For covered employers, it is also an important legal compliance responsibility.

With clear policies, appropriate training, and individualized assessments, businesses can support employees while maintaining effective operations.

A workplace that understands accommodation obligations is better equipped to protect both its people and its business.

Lisa Smith, SPHR, SCP

The post Pregnancy Accommodations: What Employers Need to Know About the PWFA appeared first on Your HelpDesk for HR .

Most employers understand the importance of having a workplace harassment policy.

But here’s an important question:

What happens when an employee actually reports harassment?

A beautifully written handbook provides little protection when supervisors ignore complaints, investigations are delayed, or employees experience retaliation after speaking up.

Effective harassment prevention requires more than policies. It requires a workplace culture where concerns are taken seriously and addressed appropriately.

Understanding Employer Responsibilities

Federal employment discrimination laws prohibit unlawful harassment based on protected characteristics, including race, color, religion, sex, national origin, age, disability, and genetic information, as applicable.

Employers must also comply with relevant state and local protections, which may cover additional characteristics or smaller businesses.

An important development occurred in January 2026 when the Equal Employment Opportunity Commission (EEOC) rescinded its 2024 Enforcement Guidance on Harassment in the Workplace.

However, the rescission did not eliminate federal prohibitions against unlawful harassment or retaliation.

Employers remain responsible for understanding and complying with applicable laws.

Not Every Workplace Disagreement Is Illegal Harassment

Employees sometimes confuse ordinary workplace conflict with unlawful harassment.

A difficult supervisor, personality disagreement, or isolated disagreement does not automatically constitute illegal harassment.

However, conduct may violate employment laws when it is connected to a protected characteristic and meets the applicable legal standards.

Employers should also recognize that conduct can violate company policy even when it does not rise to the level of unlawful harassment.

This distinction matters because employers should not wait for behavior to become legally actionable before addressing inappropriate workplace conduct.

Five Essential Harassment Prevention Practices

1. Establish clear expectations. Policies should define prohibited conduct, explain reporting procedures, prohibit retaliation, and identify possible corrective action.

2. Provide multiple reporting options. Employees should not be required to report harassment exclusively to the supervisor who may be involved in the complaint.

3. Train supervisors to respond appropriately. Managers should know how to recognize concerns, document reports, and involve HR without conducting unauthorized investigations.

4. Investigate promptly and impartially. Appropriate investigations should involve qualified investigators, relevant witness interviews, evidence review, and objective documentation.

5. Follow through after investigations. Employers should implement appropriate corrective action when warranted and monitor for retaliation or recurring problems.

Avoid the Retaliation Trap

Retaliation is a significant concern following harassment complaints.

Employees who report suspected discrimination or participate in protected investigations may be protected against adverse treatment because of that activity.

Employers should carefully review subsequent disciplinary decisions, schedule changes, demotions, and terminations involving employees who recently raised protected concerns.

Legitimate performance management may continue, but decisions should be supported by consistent, well-documented business reasons.

What Employers Should Do Next

Start with a review of your harassment policy and complaint reporting procedures.

Confirm that supervisors understand their responsibilities and that employees know how to raise concerns without fear of retaliation.

Establish a consistent investigation process, including documentation standards and appropriate follow-up.

Finally, evaluate whether harassment training is current and meets applicable state requirements.

The Bottom Line

A harassment policy is only as effective as the people responsible for implementing it.

Employers who take complaints seriously, investigate fairly, and enforce expectations consistently are better positioned to maintain a respectful workplace and reduce legal exposure.

Prevention begins with leadership, but accountability belongs to everyone.

Lisa Smith, SPHR, SCP

The post Workplace Harassment: Why Having a Policy Isn’t Enough appeared first on Your HelpDesk for HR .

Few HR situations create more confusion than managing an employee who cannot work because of a medical condition.

Questions about attendance, medical documentation, job protection, and return-to-work expectations can quickly become complicated.

One of the biggest mistakes employers make is assuming that once an employee exhausts available leave, the employer can automatically terminate employment.

Unfortunately, the legal analysis doesn’t always end there.

Understanding the Different Legal Obligations

Two important federal laws frequently intersect when employees need medical leave: the Family and Medical Leave Act (FMLA) and the Americans with Disabilities Act (ADA).

The FMLA generally provides eligible employees of covered employers up to 12 workweeks of unpaid, job-protected leave during an applicable 12-month period for qualifying reasons.

Private employers generally become covered when they employ at least 50 employees for 20 or more workweeks in the current or preceding calendar year.

Employee eligibility also depends on factors including length of service, hours worked, and worksite requirements.

The ADA generally applies to employers with 15 or more employees and may require reasonable accommodations for qualified employees with disabilities, absent undue hardship.

Importantly, additional unpaid leave may qualify as a reasonable accommodation under the ADA, even after FMLA leave has been exhausted.

State and local leave laws may provide additional protections.

Why Automatic Termination Can Be Risky

Consider an employee who has exhausted 12 weeks of FMLA leave following surgery.

The employee’s physician indicates that another three weeks of recovery may be necessary before returning to work.

The employer has a policy stating that employees must return immediately when FMLA expires or face termination.

Applying that policy automatically could create ADA concerns.

Instead, the employer may need to evaluate whether the employee has a qualifying disability and whether additional leave would be a reasonable accommodation without creating undue hardship.

That doesn’t mean employers must provide unlimited leave.

It means they must conduct an individualized assessment rather than relying exclusively on a rigid deadline.

Best Practices for Managing Medical Leave

1. Identify applicable protections early. Determine whether FMLA, ADA, pregnancy accommodation laws, workers’ compensation requirements, or state leave laws apply.

2. Provide required notices. Covered employers should follow applicable FMLA eligibility, rights-and-responsibilities, and designation notice requirements.

3. Maintain appropriate medical documentation. Request only information permitted and reasonably necessary under the applicable law.

4. Engage in the interactive process. When an employee needs accommodation, discuss functional limitations, essential duties, possible adjustments, and anticipated return-to-work timelines.

5. Evaluate each situation individually. Consider the employee’s circumstances, operational needs, available accommodations, and whether undue hardship exists.

6. Protect confidentiality. Maintain medical documentation separately from ordinary personnel records and restrict access appropriately.

What Employers Should Do Next

Review medical leave policies for automatic termination provisions, inflexible maximum leave limits, and blanket return-to-work requirements.

Train supervisors to recognize accommodation requests and promptly refer them to HR.

Before terminating an employee experiencing medical limitations, review all potentially applicable leave and accommodation obligations.

The Bottom Line

Medical leave management requires more than tracking days on a calendar.

Employers must balance employee protections, operational responsibilities, and individualized decision-making.

A consistent process, accurate documentation, and thoughtful communication can help employers avoid unnecessary legal risks while treating employees fairly.

Lisa Smith, SPHR, SCP

The post Managing Employee Medical Leave: Avoiding Costly FMLA and ADA Mistakes appeared first on Your HelpDesk for HR .

One of the most common employment law misconceptions is that employees paid a salary are automatically exempt from overtime.

Unfortunately, that’s not how the Fair Labor Standards Act (FLSA) works.

Misclassifying an employee can expose a business to unpaid overtime claims, back wages, liquidated damages, attorney fees, and other potential penalties.

The good news? Employers can reduce these risks by understanding a few fundamental rules.

Salary and Exempt Status Are Not the Same Thing

Under the FLSA, employees are generally classified as either exempt or nonexempt from overtime requirements.

Nonexempt employees generally must receive overtime compensation at one and one-half times their regular rate of pay for hours worked over 40 in a workweek.

Exempt employees are excluded from certain FLSA overtime requirements because their positions meet specific legal criteria.

For most employees classified under the executive, administrative, or professional exemptions, employers must evaluate three important factors:

1. Salary basis: Is the employee generally paid a predetermined salary that is not improperly reduced based on the quantity or quality of work?

2. Salary level: Does the employee meet the applicable minimum salary threshold?

3. Job duties: Does the employee actually perform the responsibilities required by the claimed exemption?

All applicable requirements must be satisfied.

What Is the Federal Salary Threshold in 2026?

As of October 2026, the federal standard salary threshold for most executive, administrative, and professional exemptions is $684 per week, equivalent to $35,568 annually.

The U.S. Department of Labor restored the applicable 2019 regulatory text following the court’s vacatur of the 2024 overtime rule.

However, employers must remember that some states have higher exemption salary requirements or different duties tests.

Meeting the federal salary threshold does not automatically establish compliance with state law.

Job Titles Don’t Determine Exempt Status

Consider an employee called an “Office Manager.”

Despite the title, the employee primarily answers phones, processes invoices, maintains records, and performs routine administrative duties.

The employer may assume the position qualifies for the administrative exemption because the employee receives a salary.

However, the exemption generally requires more than routine office work. The employee’s primary duty must involve qualifying work directly related to management or general business operations, including the exercise of discretion and independent judgment on matters of significance.

The actual responsibilities matter more than the job title.

Best Practices for Employers

Conduct classification audits. Review job descriptions and actual responsibilities, particularly for supervisors, administrative personnel, assistant managers, and recently promoted employees.

Verify salary requirements. Compare compensation against both federal and applicable state exemption standards.

Train supervisors. Managers should understand that nonexempt employees must accurately record all hours worked, even when overtime was not approved in advance.

Review positions after organizational changes. Promotions, reorganizations, and changes in responsibilities may affect exemption eligibility.

Document classification decisions. Maintain records supporting the exemption analysis and revisit them periodically.

Your Next Step

Create an employee classification worksheet identifying each position, compensation method, claimed exemption, applicable duties, and supporting documentation.

If an exemption appears questionable, consult qualified HR or employment law professionals before making corrections.

The Bottom Line

A salary is a method of payment, not a legal exemption.

Employers who proactively evaluate classifications can reduce wage-and-hour exposure while ensuring employees receive the compensation required by law.

When it comes to overtime compliance, the details really do matter.

Lisa Smith, SPHR, SCP

The post Employee Classification: Why Paying Someone a Salary Doesn’t Make Them Exempt appeared first on Your HelpDesk for HR .