California Computer Professionals’ Base Wage Rate Jumps 2.9%

In California, employees in the computer software field (“computer professionals”) may be exempt from the state overtime requirements and other protections granted to non-exempt workers, such as reporting time pay and mandatory meal and rest breaks. There are two tests that must be met before an employee is considered an exempt computer professional, one of which is a salary test and the other is a job duties test. Both tests must be met in order to properly classify an employee as an exempt computer professional.

2018 Salary Test

The salary test is the base rate of pay that a computer professional must be compensated to qualify for the exemption. Each year, the California Department of Industrial Relations (DIR) adjusts for inflation the computer professional’s wage rate based on the increase in the Consumer Price Index (CPI). This year, the CPI increased 2.9%. On that basis, the DIR announced that the wage rate for hourly computer professionals effective January 1, 2018 is $43.58 per hour. In 2018, salaried computer professionals must make a minimum monthly salary of $7,565.85 or an annual salary of $ $90,790.07.

Job Duties Test

The job duties test can be more difficult to establish. An employee in the computer software field is considered exempt if, in addition to the salary test, all of the following conditions are met:

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

In this context, “primarily engaged in” means the employee spends more than 50% of his or her work time performing these types of duties. Neither the employee’s job title nor the fact that the employee is paid at least the computer professional’s base wage is conclusive of an employee’s exemption status.

Non-exempt Employees Who Work with Computers

The computer professional’s exemption does not apply to:

  • trainees or entry-level employees;
  • employees who lack the level of skill and expertise necessary to work independently and without close supervision;
  • employees engaged in the operation of computers;
  • employees whose job is in the manufacture, repair, or maintenance of computer hardware;
  • engineers, drafters, machinists, or other professionals whose job is assisted by computer software programs but who are not engaged in a computer systems analysis or programming;
  • writers who write product descriptions, promotional material, instructions, and other similar material, either for print, on-screen media or the web; and
  • employees who create movie, television or theatrical special effects.

California’s mandatory-to-post Industrial Wage Orders 1-13, 15 and 17 each have a section relating to computer professionals. Ordinarily, wage orders are not updated to reflect the annual computer professional’s base wage requirements. Instead, employers may post alongside the workplace IWC this notice. Interested parties can also view a history of the base rate of pay for computer professionals here.

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