An employee who is employed in a “bona fide administrative capacity” is exempt from the minimum wage and overtime provisions of the Fair Labor Standards Act (FLSA)See 29 U.S.C. § 213(a)(1).  To qualify for the FLSA’s administrative exemption, an employee must meet the following requirements:

  • The employee must be compensated on a salary basis or a fee basis at a rate of not less than $455 per week;
  • The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and
  • The employee’s primary duty must include the exercise of discretion and independent judgment with respect to matters of significance.

See 29 C.F.R. § 541.200.
Minnesota law has a similar exemption from its minimum wage and overtime requirements for administrative employees.  See Minn. Stat. § 177.23, Subd. 7(6).  To qualify for the administrative exemption under Minnesota law, an employee must satisfy at least one of two tests.  Under the first test, the employee must:

  • Receive at least $250 per week in salary or fee;
  • Either perform office or nonmanual work directly related to management policies or general business operations, or perform functions in the administration of a school system or subdivision thereof, in work directly relating to academic instruction; and
  • Regularly exercise discretion or independent judgment.

Under the second test, the employee must:

  • Receive at least $155 per week in salary or fee;
  • Either perform office or nonmanual work directly related to business operations or management policies, or administer an educational system or subdivision thereof in work relating to academic instruction;
  • Regularly exercise discretion and independent judgment and make important decisions;
  • Devote less than 20 percent of time worked, or 40 percent in retail or service establishments, to nonexempt work; and
  • Either: (i) directly assist an owner or bona fide executive or administrative employee; (ii) perform supervised work only along lines requiring special training or experience; or (iii) execute special assignments.

See Minn. R. § 5200.0200.