Three Salaried 'Assistant Managers' and a Pay Compression Problem

On these facts, no - and the salary basis alone does not save it.

• Exemption requires the salary basis plus the duties test. The duties test turns on the employee's primary duty, not on the best thing they do occasionally. At 80% hands-on repair work identical to hourly technicians, the primary duty is production work, not management.
• The management tasks listed (opening/closing, ordering parts, covering the schedule) are supervisory-support tasks. No hiring/firing authority and routinely overridden recommendations undercut the 'management is primary' argument further.
• Do not fix this by raising the salary to a threshold number. If the duties test fails, a higher salary changes nothing. (The salary-level rules have also been in regulatory flux, so build the analysis on duties, which are stable.)
• Exposure math: $52,000 ÷ 2,080 = $25.00/hour regular rate. Ten OT hours weekly at the half-time premium is $12.50 × 10 = $125/week, about $6,500/year per person. Two-year lookback: ~$13,000 each, ~$39,000 for three; three years if the violation is found willful, ~$58,500. Liquidated damages can double it. Multiply if there are more branches.
• First step: reclassify going forward, stop the bleeding, then quantify the lookback with payroll data and take legal advice before deciding whether to make back payments proactively.

Compression is the specific problem: new hires at $58,000 out-earn six-year incumbents at $54,000–$55,000.

• This is not a general market-adjustment problem, and an across-the-board 3% raise does not fix it - it preserves the inversion and also hands money to people who are not affected.
• Targeted equity adjustment is the correct tool. Bring the three incumbents to at least $58,000 (cost: $9,000–$12,000), and ideally slightly above to recognize tenure and ratings - say $59,000–$60,000, cost roughly $15,000–$18,000.
• That leaves the large majority of the $120,000 pool for market and performance adjustments. Reserve it for documented cases: employees below the band minimum, retention risks with concrete evidence, and top performers. 'Everyone gets 2.5%' spends the pool without changing anything.
• Document the rationale for each adjustment - market data source, date, and the specific decision. If the pool is allocated by manager discretion, that documentation is the defense if a pay-equity question arises.
• Going forward, check new-hire offers against incumbent pay before the offer goes out. This compression was entirely preventable.

Yes - that is a label change, not a classification change, and it makes the situation worse if the pay stays the same.

• FLSA status follows duties and pay structure, not titles. Renaming a non-exempt employee 'Lead Technician' and paying a salary does not create an exemption; a fixed salary that is reduced for partial-day absences or that functions as a shift-rate is also not a true salary basis.
• If 'Lead Technician' is genuinely a non-exempt role, the employee must be paid overtime - a salary converted to an hourly equivalent plus OT, or a fluctuating workweek arrangement done correctly.
• The informal-leadership trap: if the new title comes with real authority (assigning work, directing two or more employees as a primary duty, effective recommendations on hiring/pay), the duties test could be met later - but that requires actual authority, and it should be documented before any exemption claim.
• Recommendation: reclassify honestly now, communicate the change as a correction that benefits the employees (overtime eligibility), and write job descriptions that match what people actually do. A title-only fix is exactly the kind of thing that turns a $39,000 problem into a willful-violation finding.