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Fitness Studios & Gyms: Hourly vs. Salaried Employee Payroll (2026)
Hourly versus salaried in a fitness business is not a preference, it is the exemption test: a salary of at least $684 a week plus a duties test. BEG: $25 per employee per month in your existing platform or $45 on isolved, live in 3 to 5 days.
Who in a fitness business can be salaried and exempt
A commissioned trainer can be exempt from overtime under FLSA section 7(i) only if three conditions are met: the employer is a retail or service establishment, the employee's regular rate exceeds one and one-half times the minimum wage for every hour worked in any week with overtime, and more than half of total earnings in a representative period of one month to one year are commissions. If any condition fails, overtime is due at time and one-half for hours over 40.
Tips paid by customers can never be counted as commissions for the section 7(i) exemption, and a retail or service establishment is one where 75 percent of annual dollar volume is not for resale and is recognized as retail in the industry. Mandatory service charges paid to service employees may count as commissions.
The salary math for fitness businesses
The standard salary level is $684 a week, $35,568 a year. BLS puts the May 2025 national median for exercise trainers and group fitness instructors at $47,160, which is $907 a week, above the floor, so for that role the duties test is the whole question. Paying a salary to a non-exempt employee is legal; it just does not remove overtime, which is then computed on the salary divided by hours actually worked each week.
What changes when a role moves between the two
Moving personal trainers and group fitness instructors from hourly to salaried changes the pay code, the timekeeping rule and the overtime treatment at once. A salaried non-exempt employee still needs hours recorded every week, and a salaried exempt one needs the exemption documented against the rule above, because in an audit the burden of proving the exemption sits with the employer.
The rules behind this page, with sources
General information, not legal advice. Every rule below was read on the agency page linked next to it.
- A commissioned trainer can be exempt from overtime under FLSA section 7(i) only if three conditions are met: the employer is a retail or service establishment, the employee's regular rate exceeds one and one-half times the minimum wage for every hour worked in any week with overtime, and more than half of total earnings in a representative period of one month to one year are commissions. If any condition fails, overtime is due at time and one-half for hours over 40. [DOL Fact Sheet #20]
- Tips paid by customers can never be counted as commissions for the section 7(i) exemption, and a retail or service establishment is one where 75 percent of annual dollar volume is not for resale and is recognized as retail in the industry. Mandatory service charges paid to service employees may count as commissions. [DOL Fact Sheet #20]
Read the full guide to FLSA overtime rules for employers, and the rest of the fitness business payroll library.
Managed Payroll, Handled.
BEG manages payroll at $25-$45 per employee per month, all-inclusive. Get an instant cost comparison for your business.
Frequently Asked Questions
Can a fitness business pay personal trainers a salary and skip overtime?
Only if the role meets an exemption: the $684 weekly salary floor plus the duties test, or an industry-specific exemption. A commissioned trainer can be exempt from overtime under FLSA section 7(i) only if three conditions are met: the employer is a retail or service establishment, the employee's regular rate exceeds one and one-half times the minimum wage for every hour worked in any week with overtime, and more than half of total earnings in a representative period of one month to one year are commissions.
Does the $47,160 national median for exercise trainers and group fitness instructors clear the salary test?
$907 a week is above the $684 floor, so salary is not the obstacle; the duties test is. BLS OEWS, May 2025.
What does managed payroll cost for a fitness business?
$25 per employee per month inside your existing platform or $45 on BEG's isolved HCM, all-inclusive, with a $500 monthly minimum. Trainer 1099 vs W-2 classification, commission-based training pay and class-based instructor pay are configured at setup, not billed as add-ons.
Related Resources
Anthony leads payroll solutions at Business Executive Group, a national managed payroll firm serving businesses across industries including Fitness Studios & Gyms. BEG manages payroll at $25-$45 PEPM, all-inclusive, with deep expertise in compliance, multi-state filing, and industry-specific payroll requirements. Get instant pricing at beghr.com.
Authoritative source: U.S. Department of Labor: Overtime Pay Under the FLSA
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