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Run the Payroll Fee Auditor →Blog · Payroll Management · Engineering
Engineering & Professional Services Firms: Hourly vs. Salaried Employee Payroll (2026)
Hourly versus salaried in an engineering firm is not a preference, it is the exemption test: a salary of at least $684 a week plus a duties test, and engineering firms have industry-specific exemptions on top. Civil engineers at the national median earn $1,939 a week. BEG: $45 per employee per month inside the payroll software you already use, live in 3 to 5 days.
Who in an engineering firm can be salaried and exempt
Engineering is listed as a field of science or learning for the learned professional exemption, so engineers whose primary duty requires advanced knowledge acquired through prolonged specialized instruction and who are paid on a salary or fee basis at the standard salary level are exempt from overtime. Job titles alone do not determine exemption status.
The standard salary level for the executive, administrative and professional exemptions is $684 per week, equivalent to $35,568 per year; the highly compensated employee threshold is $107,432 per year including at least $684 per week paid on a salary or fee basis.
The salary math for engineering firms
The standard salary level is $684 a week, $35,568 a year. BLS puts the May 2025 national median for civil engineers at $100,840, which is $1,939 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 engineers and project managers 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.
- Engineering is listed as a field of science or learning for the learned professional exemption, so engineers whose primary duty requires advanced knowledge acquired through prolonged specialized instruction and who are paid on a salary or fee basis at the standard salary level are exempt from overtime. Job titles alone do not determine exemption status. [DOL Fact Sheet #17D]
- The standard salary level for the executive, administrative and professional exemptions is $684 per week, equivalent to $35,568 per year; the highly compensated employee threshold is $107,432 per year including at least $684 per week paid on a salary or fee basis. [DOL WHD Earnings thresholds for the EAP exemption]
Read the full guide to FLSA overtime rules for employers, and the rest of the engineering firm payroll library.
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Frequently Asked Questions
Can an engineering firm pay engineers 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. Engineering is listed as a field of science or learning for the learned professional exemption, so engineers whose primary duty requires advanced knowledge acquired through prolonged specialized instruction and who are paid on a salary or fee basis at the standard salary level are exempt from overtime.
Does the $100,840 national median for civil engineers clear the salary test?
$1,939 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 an engineering firm?
$45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum. Prevailing wage for government projects, billable hour payroll allocation and PE license classification 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 Engineering & Professional Services Firms. BEG manages payroll at $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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