Exempt vs Non-Exempt in Behavioral Health: Therapists, RBTs, Case Managers

Federal rules put the executive, administrative and professional exemptions — the ones behavioral health roles are classified under — through the same three tests before salary-without-overtime is on the table: the employee's duties must actually fit the exemption, the employee must be paid on a salary basis, and the salary must clear a minimum level.

Paying someone a salary is not, by itself, a classification.

The salary basis test requires a predetermined, fixed salary that is not reduced because of variations in the quality or quantity of work performed.

Subject to the exceptions listed in the regulations, an exempt salaried employee must receive the full weekly salary for any week in which they perform any work, without regard to days or hours — and if the employee is ready, willing and able to work, deductions may not be made for time when work is not available.

As of October 7, 2026, the federal salary level for the executive, administrative and professional exemptions is $684 per week, which DOL describes as the equivalent of a $35,568 annual salary.

Administrative and professional employees can alternatively be paid on a fee basis, and up to 10 percent of the $684 weekly level may be satisfied by nondiscretionary bonuses, incentives and commissions paid annually or more frequently.

That $684 figure is back where the rule started.

DOL's 2024 overtime rule raised the salary level, but the U.S. District Court for the Eastern District of Texas vacated the rule on November 15, 2024, and the Northern District of Texas did so separately on December 30, 2024.

The Fifth Circuit dismissed the appeals of both orders on May 5 and May 7, 2026, and on May 15, 2026 DOL republished the earlier 2019 rule text that sets the $684 weekly level.

There is a separate, higher bar for high earners: the highly compensated employee test requires total annual compensation of at least $107,432, of which at least $684 per week must be paid on a salary or fee basis.

An employee who fails any one of the three tests is non-exempt under these exemptions.

Under the FLSA, a non-exempt employee must be paid at least one and one-half times their regular rate for every hour worked over 40 in a workweek.

Classification is also yours to give up.

DOL is explicit that an employer may treat an employee who meets an exemption as non-exempt, as long as it pays at least the federal minimum wage for all hours worked and the overtime premium over 40 — which makes hourly the side to land on whenever the duties test is uncertain.

The learned professional exemption requires a primary duty of work requiring advanced knowledge in a field of science or learning, customarily acquired by a prolonged course of specialized intellectual instruction.

The exemption is limited to professions where specialized academic training is a standard prerequisite for entry, and the best prima facie evidence is possession of the appropriate academic degree.

The federal guidance closest to behavioral health is DOL's January 2026 opinion letter (FLSA2026-1), which repeated its earlier view that social workers with master's degrees who work in the field of their degree will generally meet the learned professional duties test.

For master's-level social workers, that is a direct fit.

A licensed master's-level clinician whose primary duty is delivering therapy is the closest profile — treat the letter as a guide for running the tests on your own roles and licenses, not a ruling that settles them.

The same letter carries two cautions.

First, DOL said that the possession of a professional license and a master's degree does not alone establish exempt status — the clinician's primary duty must actually require the advanced knowledge, not merely carry the credential.

Second, DOL told the LCSW who wrote in that if her compensation changed to hourly, she would likely no longer qualify for the exemption even if her duties stayed the same.

The salary basis is doing real legal work here.

Two scope notes matter.

Counselors and marriage and family therapists are not named in any DOL text we reviewed, so the social-worker reasoning is an analogy to apply carefully rather than a ruling to rely on.

And 29 CFR 541.600(e) closes the physician shortcut for this group: the exception from the salary requirement for medical occupations does not apply to therapists, social workers, psychologists or nurses — they must meet the salary or fee requirement to be exempt.

How salary, fee and per-session structures fit into a practice budget is the subject of our pay models guide.

This page covers who is eligible for each treatment, not how to price them.

Psychiatry is the behavioral health role federal law treats differently on salary.

Licensed physicians practicing medicine are exempt professionals with no salary requirement — the regulation states that the salary requirements of § 541.300 and subpart G do not apply to them.

An employed psychiatrist can therefore be exempt while paid hourly or per visit.

The definition is narrow, though.

29 CFR 541.304 defines “physicians” as medical doctors including general practitioners and specialists, osteopathic physicians, podiatrists, dentists and optometrists.

Psychiatrists — MDs and DOs — are squarely inside it.

Psychiatric nurse practitioners are the open question.

No DOL text we found settles whether a PMHNP counts as a practitioner exempt from the salary test, and DOL treats registered nurses under the salary test, so do not assume the no-salary rule reaches your PMHNPs.

Confirm that classification with employment counsel before paying one hourly without overtime.

On the other side of the line are the roles that keep ABA clinics and case-management teams running.

To be eligible for RBT certification, the BACB requires the applicant to be at least 18 years old and have at least a high school-level education.

The learned professional exemption presumes specialized academic training as a standard prerequisite for entry — which a high-school-entry credential does not meet.

No DOL ruling we found names RBTs, so this is a classification drawn from the entry credential rather than a per-role ruling: RBTs are generally non-exempt, paid hourly with overtime over 40 hours.

The regulation itself draws the parallel for adjacent health roles: licensed practical nurses and other similar health care employees generally do not qualify as exempt learned professionals, because possession of a specialized advanced academic degree is not a standard prerequisite for the occupation.

Behavioral health technicians hired on a bachelor's degree generally sit on the same side of that line.

Case managers deserve a closer look, because the learned professional analysis turns on what degree the role actually requires.

DOL's letter cites the Ninth Circuit's 2011 decision in Solis, which held that a degree requirement that could be satisfied by bachelor's degrees in fields as varied as anthropology, education, criminal justice and gerontology was not sufficiently specialized for the learned professional exemption for social-work positions.

If your case manager role accepts that kind of open degree list, that holding is the analogy to worry about — and it is Ninth Circuit precedent, not a national rule, so treat it as fact-specific and binding in the Ninth Circuit rather than nationwide.

The safe pattern for this group is ordinary payroll discipline: hourly pay, hours recorded as actually worked, and overtime over 40 in a workweek.

Where a technician role bleeds into supervision or program design, re-run the duties test for that specific person rather than assuming the job title settles it.

California, Washington and Colorado all set exempt salary floors well above the federal $684 a week — and when you employ someone in a state with its own floor, the state's test is the one that decides.

In California, exempt executive, administrative and professional employees must earn a monthly salary of at least twice the state minimum wage for full-time employment; with California's minimum wage at $16.90 per hour from January 1, 2026, that puts the 2026 California exempt salary floor at $70,304 a year.

Washington's 2026 exempt salary threshold is 2.25 times the state minimum wage for a 40-hour week, regardless of employer size.

With Washington's 2026 minimum wage at $17.13 per hour, that works out to $1,541.70 per week, or $80,168.40 a year.

Colorado's 2026 minimum exempt salary is $57,784 a year — though Colorado, like federal law, lets doctors, lawyers and teachers be exempt based on duties alone without a minimum salary.

New York also has exempt salary thresholds that vary by region, at least for the executive and administrative exemptions: a law-firm analysis reports 2026 figures of $1,275 per week ($66,300 a year) in New York City, Nassau, Suffolk and Westchester, and $1,199.10 per week ($62,353.20) elsewhere in the state.

We could not verify those numbers against the state's rule text, and whether New York applies any salary floor to the professional exemption is likewise unconfirmed — check with the New York State Department of Labor before relying on a figure.

The practical consequence for a multi-state group is simple: a salary that exempts a clinician in one state can leave the identical role non-exempt in another.

Run the state-level test for every exempt role in every state where you employ people, and re-run it whenever a state minimum wage moves.

Misclassification does not stay hidden.

An FLSA claim for unpaid minimum wage or overtime must be filed within two years, or three years if the violation was willful, and an employer that violates the rules owes the unpaid wages plus an equal additional amount as liquidated damages.

On a salaried clinician's wages, that arithmetic doubles quickly.

The salary-basis rules have their own teeth, separate from the level test.

An employer with an actual practice of improper salary deductions loses the exemption for the period of the deductions — for employees in the same job classification working for the managers responsible for the deductions.

Isolated or inadvertent improper deductions do not cost the exemption if the employer reimburses the employees for them.

If improper deductions are a live risk in your payroll, the regulation provides a safe harbor: a clearly communicated written policy prohibiting the improper deductions, a complaint mechanism, reimbursement of any improper deductions, and a good-faith commitment to comply in the future.

With all four in place, you keep the exemption unless you willfully continue the deductions after a complaint.

The fix itself is ordinary payroll work: reclassify the role as non-exempt going forward, record all hours worked, and pay overtime over 40.

Reclassifying is always available even where an exemption would fit — DOL says the employer may treat an exempt-eligible employee as non-exempt as long as minimum wage and overtime are paid.

For anything that is not a clean-cut call — a borderline duties test, a multi-state salary floor, a PMHNP or a fee arrangement — take the specific facts to employment counsel.

Once each role is classified and the payroll mechanics are settled, the behavioral health hiring hub picks up the rest of the sequence: posting the role, screening candidates and getting your new clinician productive.