A new law signed by Gov. Schwarzenegger and now in effect amends the overtime exemption for computer software professionals. The California exemption for computer software employees (Labor Code Section 515.5) already required that these employees earn no less than $36 per hour. The new law, A.B. 10, now also permits exemption for employees who earn a salary of at least $75,000 annually for full-time employment and are paid no less than $6,250 at least once a month. The salary levels, like the hourly rates, will be adjusted annually based on the Consumer Price Index.
Besides the pay rules, an employee must also meet all of the following duties requirements to qualify for the computer software exemption in California. These duties rules aren’t new, but the beginning of the year is a good time to review exemptions to make sure you’ve got it all right.
1. The employee must be primarily engaged (spending more than half of the work time) in intellectual or creative work.
2. The employee must be primarily engaged in work that requires discretion and independent judgment.
3. The employee must be primarily engaged in duties that consist of one or more of the following: a) applying systems analysis techniques and procedures, including consulting with users, to determine hardware, software, or system functional specifications; b) designing, developing, documenting, analyzing, creating, testing, or modifying computer systems or programs, including prototypes, based on and related to user or system design specifications; and/or c) documenting, testing, creating, or modifying computer programs related to the design of software or hardware for computer operating systems.
4. The employee must be highly skilled and proficient in the theoretical and practical application of highly specialized information to computer systems analysis, programming, and software engineering.
There are some job categories that won’t be exempt, even if the above requirements appear to be satisfied. These include:
- Trainees and entry level. The employee is learning to become proficient in the theoretical and practical application of highly specialized information to computer systems analysis, programming, and software engineering. Or, the employee is in a computer-related occupation but hasn’t attained the level of skill and expertise necessary to work independently and without close supervision.
- Computer operators. The employee operates computers or manufactures, repairs, or maintains computer hardware and related equipment.
- CAD users. The employee is an engineer, drafter, machinist, or other professional whose work highly depends on or is facilitated by the use of computers and computer software programs, and who is skilled in computer-aided design software, including CAD/CAM, but who is not in a computer systems analysis or programming occupation.
- Writers. The employee writes material (box labels, product descriptions, documentation, promotional material, setup and installation instructions, etc.) for print or onscreen media, or writes or provides material intended to be read by the customers, subscribers, or visitors to computer-related media such as the web or CD-ROMs.
- Special effects artists. The employee creates imagery for effects used in the motion picture, television, or theatrical industry.
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