Breaking: Accountants Are Entitled to Overtime
Many believe accountants are not entitled to overtime pay because they qualify for the professional exemption under the Fair Labor Standards Act. In fact, many accountants may be entitled to overtime pay, depending on the accountant’s job duties and range of discretion in performing his or her work.
Generally, the Fair Labor Standards Act requires employers to pay their employees for time worked over forty (40) hours in any workweek. Employees employed in an executive, administrative, or professional position, however, are exempt from the overtime requirement. Further, accountants are specifically identified under the law to be employed in a professional position. To qualify for the professional exemption, an employee must meet all three elements of the primary duty test: (1) the employee must perform work requiring advanced knowledge; (2) the advanced knowledge must be in a field of science or learning; and (3) the advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.
However, whether an accountant is exempt from overtime pay requires a thorough case-by-case analysis due to several factors. First, a job title alone is insufficient to establish exemption under the law. This means a simple “Accountant” title does not preclude an employee from overtime pay and does not absolve an employer from its overtime obligations. Second, certified public accountants generally do meet the elements of the primary duty test. Accountants who are not certified public accountants but perform the same or similar duties as certified public accountants also generally meet the elements of the primary duty test. Third, accounting clerks, bookkeepers, and other employees who perform routine mental, manual, mechanical, or physical work will not qualify for the professional exemption.
Moreover, in order for one to qualify as a professional accountant, his or her primary duty must typically rely on professional judgment to eliminate financial irregularities in the accounting process. The occasional exercise of professional judgment does not constitute primary duty and will not qualify for the professional exemption. For example, an accountant who performs audits likely qualifies for the professional exemption because he or she must exercise professional judgment in providing his or her opinion in every audit report. Conversely, an employee who merely enters data and is responsible for noting and reporting irregularities or errors is not considered a professional accountant. This is due to the fact that any ordinary bookkeeper is expected to note and report irregularities and errors in data entry.
In sum, if you are a certified public accountant or audit accountant, you are likely not entitled to overtime pay. However, if you do not exercise professional judgment and perform only the duties of an ordinary bookkeeper, you may be entitled to overtime pay. Nonetheless, a lawyer who is experienced in labor and employment law can help you better determine whether you qualify for the professional exemption under the Fair Labor Standards Act.
Thanh Le is an associate attorney at Nguyen & Chen, LLP, whose practice focuses on litigation and corporate law. She obtained her Bachelor of Science in Biotechnology from the University of Houston and her Juris Doctor from South Texas College of Law, both with Magna Cum Laude honors. She is also fluent in Vietnamese and has spent her time volunteering at Houston Volunteer Lawyers, LegalLine, and Veterans Legal Clinic.