The Department of Labor has found that many businesses are guilty of employee misclassification. This doesn't relate to job titles or departments, but rather the eligibility for coverage under the Fair Labor Standards Act (FLSA). Covered employees are guaranteed at least minimum wage for all of their time and attendance, in addition to overtime if they work more than 40 hours in a single work week. On the other hand, individuals who qualify for exemptions from the FLSA are not granted these basic rights because they are usually paid salaries that more than make up for the difference.

However, it's easy for companies to fall into the trap of assuming that paying employees on a salary basis automatically makes them exempt from the FLSA and overtime pay. This is not the case, and one company that made the mistake recently agreed to pay 24 of its employees $92,000 in back wages for its unpaid employee attendance. Nebraska Title Co., a firm that handles real estate titles and closing processes, was investigated by the Department of Labor's Wage and Hour Division and found to be violating overtime provisions.

"Improperly classifying workers as being exempt from overtime is a common violation found in the real estate industry," said Michael Staebell, a district director in Des Moines, Iowa. "The criteria for exemption from overtime are very specific to ensure workers are properly compensated for all hours worked."

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