Being paid a salary does not automatically make an employee exempt from overtime. On-call compensation first depends on FLSA coverage and exemption status, then on whether the waiting time counts as hours worked. The salary label alone does not answer either question. [1]
Rules that determine the answer
An employee required to remain on the employer’s premises, or so restricted that personal use of the time is not effective, generally is working while on call. Being reachable at home is often different, but response limits, call frequency, travel restrictions, and actual interruptions matter. Nonexempt employees must count compensable hours toward the applicable minimum wage and overtime rules. [2]
For a genuinely exempt employee, the FLSA ordinarily does not require an additional hourly on-call premium, although a contract, policy, collective bargaining agreement, or state rule may. For nonexempt salaried employees, the overtime calculation depends on the lawful pay arrangement and regular rate; do not simply divide by forty without examining the arrangement. A promised stipend also does not automatically cover all overtime owed. [1] [2]
What to check before taking the next step
- Confirm the actual exemption and duties analysis rather than relying on the job title.
- Record calls, required response times, location restrictions, and work performed remotely.
- Separate waiting time from the time actually spent responding, which is work.
- Compare total weekly compensation and compensable hours with the applicable federal and state overtime rules.
Practical example
A salaried nonexempt technician receives repeated overnight calls requiring immediate computer work. Each work interruption counts, and the restrictions may also make additional waiting time compensable depending on the facts.
For related situations, see Sunday and holiday premium pay and returning to work after disability leave.
Primary sources
Sources checked: October 31, 2026.