The University of Tennessee, Knoxville

Tennessee County Municipal Advisory Service

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Payment on a Fee Basis

Reference Number: MTAS-922
Tennessee Code Annotated
Reviewed Date: July 28, 2016
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Bona fide administrative and professional employees also may be paid on a "fee basis", rather than a salary basis. “An employee will be considered to be paid on a fee basis if the employee is paid an agreed sum for a single job regardless of the time required for its completion. A fee is paid for the kind of job that is unique rather than for a “series of jobs repeated an indefinite number of times and for which payment on an identical basis is made over and over again.” Payments based on the number of hours or days worked and not on the accomplishment of a given single task are not considered payments on a fee basis. “To determine whether the fee payment meets the minimum salary required for exemption, the amount paid to the employee will be tested by determining the time worked on the job and whether the fee payment is at a rate that would amount to at least $455 per week if the employee had worked 40 hours.” 29 C.F.R. § 541.605. Effective December 1, 2016 the fee payment must amount to at least $913 per week.