Do employers risk violating the FLSA by reducing PTO? Is it part of an employee’s salary?

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Those were the critical issues in a precedential decision that the Third Circuit Court of Appeals issued yesterday. So let’s talk about it.

Generally speaking, a federal law called the Fair Labor Standards Act (FLSA) says that people who earn an hourly wage can get overtime (one-and-a-half times their regular hourly wage for every hour they work beyond a traditional forty-hour week). Conversely, folks that earn a salary of at least $684 per week may be exempt from the FLSA overtime requirements. That will depend on their other duties and responsibilities.

The employer in this

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