Exemptions in California can be very confusing. Trying to determine whether an employee is exempt from overtime or non-exempt and entitled to overtime is difficult, and this is especially true with IT professionals. While IT professionals are usually salaried employees, salary alone does not mean they are not entitled to overtime.
So what are IT professionals? IT professionals (i.e. Information technology professionals) can hold a variety of job titles – a few examples include: IT specialists, systems administrators, systems engineers, IT technicians, database administrators, desk and IT support, and network operations engineers or specialists. However, whether an IT professional is exempt or non-exempt does not depend on the title, but comes down to the duties. Because most IT professionals work long hours, it is especially important to determine whether as an IT professional, you are entitled to overtime pay.
Most IT professionals, if truly exempt, will generally fall under one of two exemptions: (1) the computer professional exemption; and (2) the administrative exemption (although other exemptions may sometimes apply).
The Computer Professional Exemption
Under California Labor Code Section 515.5, employees in the computer software field are exempt and therefore not entitled to overtime ONLY if ALL of the following four requirements are met:
(1) The employee is primarily engaged in work that is intellectual or creative and that 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.
(3) The employee is highly skilled and is proficient in the theoretical and practical application of highly specialized information to computer systems analysis, programming, or software engineering. A job title shall not be determinative of the applicability of this exemption.
(4) The employee’s hourly rate of pay is not less than thirty-six dollars ($36.00) or, if the employee is paid on a salaried basis, the employee earns an annual salary of not less than seventy-five thousand dollars ($75,000) for full-time employment, which is paid at least once a month and in a monthly amount of not less than six thousand two hundred fifty dollars ($6,250). The Division of Labor Statistics and Research shall adjust both the hourly pay rate and the salary level described in this paragraph on October 1 of each year to be effective on January 1 of the following year by an amount equal to the percentage increase in the California Consumer Price Index for Urban Wage Earners and Clerical Workers. Effective January 1, 2016 the minimum hourly rate is $41.85 and the minimum annual salary is $87,185.14 for full-time employment, and paid not less than $7,265.43 per month.
So in short, what does this all mean?
While there is no bright line rule, this means generally that to be considered exempt under the Computer Professional Exemption, employees must be:
- Exercising independent discretion and judgment – this generally means that the employee makes decisions over significant matters and is free of direct supervision;
- Highly skilled and proficient – this generally excludes trainees, entry level positions, and those learning to become proficient or those not at a skill level that does not require supervision;
- Primarily engaged in intellectual or creative work and one or more of the duties listed above – generally, “primarily engaged” means more than one-half of the employee’s work time.
- Earning no less than $41.85 per hour or $87,185.14 per year/$7,265.43 per month (as of January 1, 2016).
The Administrative Exemption
Under the Industrial Welfare Commission (IWC) Wage Orders, an employee falls under the Administrative Exemption ONLY if ALL of the following requirements are met:
- you must perform “office or non-manual work directly related to management policies or general business operations;”
- you must “customarily and regularly exercises discretion and independent judgment;”
- you must regularly and directly assist the owner of the business, or another exempt administrator OR do specialized or technical tasks that require special training or education and only under general supervision OR do special assignments and tasks only under general supervision;
- you must be engaged in these administrative duties more than 50% of your work time; and
- you must also earn a monthly salary equivalent to no less than two times the state minimum wage for full-time employment ($41,600 per year or $3,466.67 a month).
With the Administrative Exemptions and IT professionals, many times the question of exemption really comes down to whether the IT professional is performing tasks and functions that involve matters of substantial importance to running the business OR is simply engaged in the core day-to-day business.
If you are an IT professional and want to know whether you are properly classified, please consult with one of our attorneys.
It’s hard enough returning to work after baby – place on top of that finding enough time, let alone room, to pump at work. The great thing is that California is one of the more protective states for
breastfeeding moms. Under the California Labor Code, employers are required to provide reasonable break time for expressing breast milk.
Section 1030. Every employer, including the state and any political subdivision, shall provide a reasonable amount of break time to accommodate an employee desiring to express breast milk for the employee’s infant child. The break time shall, if possible, run concurrently with any break time already provided to the employee. Break time for an employee that does not run concurrently with the rest time authorized for the employee by the applicable wage order of the Industrial Welfare Commission shall be unpaid.
Section 1031.The employer shall make reasonable efforts to provide the employee with the use of a room or other location, other than a toilet stall, in close proximity to the employee’s work area, for the employee to express milk in private. The room or location may include the place where the employee normally works if it otherwise meets the requirements of this section.
Section 1032. An employer is not required to provide break time under this chapter if to do so would seriously disrupt the operations of the employer.
Section 1033. (a) An employer who violates any provision of this chapter shall be subject to a civil penalty in the amount of one hundred dollars ($100) for each violation.(b) If, upon inspection or investigation, the Labor Commissioner determines that a violation of this chapter has occurred, the Labor Commissioner may issue a citation. The procedures for issuing, contesting, and enforcing judgments for citations or civil penalties issued by the Labor Commissioner for violations of this chapter shall be the same as those set forth in Section 1197.1. (c) Notwithstanding any other provision of this code, violations of this chapter shall not be misdemeanors under this code.
In short, this means: (1) the break time runs concurrently with breaks required for all employees (i.e. meal and rest breaks) – in other words, if you can express milk during your lunch or rest break, then this fulfills the Labor Code requirement; (2) any additional break time can be unpaid; and (3) the employer must make reasonable efforts to provide a private place near your work area for you to express milk – I.e. No more having to pump in the public restroom. The only exception to these laws is if providing breastfeeding breaks would seriously disrupt the operations of an employer.
Finally, taking aside these breastfeeding accommodations, pregnant women and women return to work after pregnancy are entitled to California’s protections against discrimination and harassment based on their pregnancy (including need to breastfeed). Thus, if you are experiencing any offensive or unfair conduct, or believe you are being penalized because of your pregnancy (or breastfeeding), call one of our attorneys.
The general answer is yes – and this is true even if your plan is unlimited, so long as it is necessary in performing your duties. In Cochran v. Schwan’s Home Service, Inc., 228 Cal.App.4th 1137 (2014) (“Cochran”), the California Court of Appeal held that employers must reimburse employees for required work-related use of personal cell phones—regardless of whether they incur any additional out-of-pocket expense from that work-related use. The Court held that even where the plan is unlimited and the employee did not incur any additional cost, reimbursement was required under Labor Code Section 2802 because the employer would otherwise receive a windfall as it would be passing its operation expense onto the employee.
The Cochran case of course raises a number of interesting issues with respect to other business expenses incurred. For example, expenses incurred when working remotely, such as electricity, internet, and use of personal devices. Arguably, such expenses are also reimbursable under Section 2802. While courts have not ruled on these specific issues, we will likely see these issues arise especially given the ease and ability of employees to work remotely.
If you believe you have incurred any business expenses that have not been reimbursed, contact one of our attorneys to discuss your situation.
Am I An Independent Contractor or Employee?
An increasingly common question is whether a person working for a particular company is an employee or an independent contractor. While the answer to the question will always be dependent on each specific situation, in general, when the person works full-time and exclusively for a single company, the person is often an employee rather than an independent contractor.
Why is it important?
It is important to know if a person is actually an employee because an employee will be entitled to, among other things, minimum wages for all hours worked, overtime wages, rest periods, meal periods, and reimbursement for expenses. Employees may also be entitled to benefits with respect to workers’ compensation, unemployment, and disability insurance. Thus, an employee has far greater rights and protections than an independent contractor.
What is an independent contractor?
There is no exact definition of an independent contractor. Instead, Courts look at a number of different factors to determine whether a person qualifies as an independent contractor or employee. Very simply, an independent contractor is a person who works for a company on a project basis, and has freedom over how and when to perform work. For example, an insurance company might hire a contractor to design and install a computer network. The independent contractor would design the network (subject to the insurance company’s approval) and then build the network at his discretion consistent with his approved designs. Here, an independent contractor would perform the job, but would also be free to perform work for other companies as the person saw fit. In contrast, an employee would be a person who was required to work specified hours, was under the direction and control of the company at all times, and continued to work solely for the company.
Other factors considered by Courts include: (1) whether the person performing services is engaged in an occupation or business different from that of the employer; (2) whether the work is a part of the regular business of the alleged employer; (3) whether the employer or the worker supplies the tools and the place for the work; (4) the alleged employee’s investment in the equipment or materials required by the task; (5) whether the service rendered requires a special skill; (6) the kind of occupation; (7) the person’s opportunity for profit or loss depending on their managerial skill; (8) the length of time for which the services are to be performed; (9) the degree of permanence of the working relationship; (10) the method of payment, whether by time or by the job; and (11) whether or not the parties believe they are creating an employer-employee relationship.