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August 17, 2010
Independent Judgment, Discretion and Salary Requirements

In a BLR webinar entitled ‘High-Tech Workers: Who’s Entitled to Overtime and Who’s Not; Avoid the Top 5 Most Common Mistakes’, Allen Kato and Dan Obuhanych discuss independent judgment, discretion and salary requirements that organizations can take into consideration regarding its workers.

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Allen Kato explains that employers should also be aware of independent judgment and discretion. Primary duty must include the exercise of discretion and independent judgment. If someone is exercises high-tech skills in their work, this does not necessarily mean that this individual is exercising independent judgment and discretion. For example, a Xerox repair technician may display highly technical skills but this does not mean that the technician is using independent judgment and discretion.

Also, Dan Obuhanych states that employees earning less than $23,600 annual salary (or $455 per week) are entitled to overtime pay. This is paid on a salary or fee basis. The exemption test consists of both the duties test section and the salary test section.

Allen M. Kato, Esq., is an attorney in the San Francisco, California office of law firm Fenwick & West, LLP ( He also trains managers and HR professionals on a regular basis. Dan Ko Obuhanych, Esq., is an attorney in the Mountain View, California office of law firm Fenwick & West, LLP. In his counseling practice, Obuhanych advises Fortune 500 companies and small employers on a wide variety of employment and labor issues, including harassment, retaliation, union avoidance, wage and hour issues, independent contractor status issues, and leave and accommodation matters.

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