Yes, it is completely fine for non-exempt employees to manage other non-exempt employees. In fact, employers are under no obligation to classify any employees as exempt, even if they meet the criteria under the Fair Labor Standards Act. If employers wish, they may have an entire workforce of non-exempt employees. The important thing is to follow any wage and hour laws applicable to non-exempt employees, including paying them for any overtime. For more payroll and HR tips, check out our Blog.