HR Practice Pointer: Understanding the “Computer Professional Exemption”

  27 July 2016

Increasingly, employers have the need for computer professionals as part of their workforce.

Due to the nature of their responsibilities, these employees can be required to work long hours, thereby incurring overtime. However, certain computer professionals may be exempt from overtime, pursuant to the Computer Professional Exemption, provided specific criteria are met. Unfortunately, some employers do not realize the high wage requirements and level of skill that must be met before a computer/IT employee can properly be classified as exempt from overtime. Because of the serious wage and hour implications associated with misclassifying an employee as exempt from overtime, employers need to perform a careful and detailed analysis of a computer professional's job duties before classifying the employee as exempt from overtime pursuant to the Computer Professional Exemption.

Wage Requirements

The first threshold that the employer must meet is the wage requirement. Specifically, in order to be properly classified as exempt under the Computer Professional Exemption, the employee must earn the minimum pay requirements under the exemption, which generally increase every year. Effective January 1, 2014, pursuant Labor Code Section 515.5(a)(4), the wage requirements for the Computer Professional Exemption are as follows:

$40.38 per hour,

$7,010.88 monthly salary,

or A minimum annual salary of $84,130.53

Job Duties

Pursuant to California Code of Regulations Title 8 Section 11040 (1)(A)(3)(i), in order to be deemed exempt, a computer professional must meet all of the following criteria:

  1. The employee must be primarily engaged in work that is intellectual or creative and that requires the exercise of discretion and independent judgment.
  2. The employee must be primarily engaged in duties that consist of one or more of the following: a. The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software, or system functional specifications. b. The design, development, documentation, analysis, creation, testing, or modification of computer systems or programs, including prototypes, based on and related to, user or system design specifications. c. The documentation, testing, creation, or modification of computer programs related to the design of software or hardware for computer operating systems. d. The employee is highly skilled and is proficient in the theoretical and practical application of highly specialized information to computer systems analysis, programming, and software engineering.

It is important to note that a job title is not definitive as to whether an employee is properly classified. Thus, it is recommended that employers have job descriptions for each position for an individual employee or a group of employees performing the same job. It is key to make sure that all of the employees to whom the job description applies, do in fact perform all of the duties delineated, and that there are no unlisted job duties, or duties listed that do not apply. If an investigation is initiated by a state or federal agency, they may interview co-workers to determine if the employee(s) in a particular job category do in fact perform the duties set forth in the job description, in addition to reviewing the actual job description. This can mean the difference between a large settlement and a mere investigation.

Rest and Meal Periods

Employers should recognize that the law is unsettled as to whether or not an exempt computer professional (as opposed to the other exempt categories such as the executive or administrative) must be provided rest and meal periods. Employers should consult with their legal counsel for advice on this matter. _________________________________________

Dona Lee Skeren, Esq., assistant managing attorney of Floyd, Skeren & Kelly's employment law department, can be reached at (818) 206-9222, for any additional questions.