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Understanding the Computer Employee Exemption from Overtime

Published: July 14, 2016 Author: Clearpoint Tags: Information Technology Jobs Houston, IT Overtime Exemption, IT Recruiters, Houston IT Recruiters, IT Staffing

With many computer specialists qualifying for a high salary, overtime can be a very expensive proposition for tech employers. However, the United States Department of Labor offers an overtime exemption for computer employees, providing they meet certain requirements. These exemptions are covered in Section 13(a)(1) and Section 13(a)(17) of the Fair Labor Standards Act (FLSA). This article will help you understand the computer employee exemption and how it applies to your staff.

The Requirements

To qualify for the exemption, an employee must:

  • Be paid a salary or of at least $455 a week (changes to $913 a week effective December 1, 2016); or, if hourly, make at least $27.63 an hour
  • Be employed as a computer systems analyst, computer programmer, software engineer, or another skilled position in the computer field
  • Have a primary duty of:
  • Systems analysis (including consultation with users) to determine hardware, software, or system specifications
  • Design, development, documentation, analysis, creation, testing, or modification of computer systems or programs (including prototypes) based on user/system specifications
  • Design, documentation, testing, creation, or modification of computer programs related to machine operating systems
  • Or a combination of these duties that requires the same level of skills

There are some tech employees who don’t qualify for this exemption, including:

  • Employees who repair or manufacture computer hardware or equipment
  • Employees whose work is aided or dependent upon computers and software but are not programmers, system analysts, or otherwise employed in skilled computer-related occupations.

Additional Notes

Keep in mind that the employee’s job title isn’t what qualifies them for this exemption. Rather, it’s their specific duties and their compensation that fall under the DOL’s requirements. Additionally, the qualifying duties must be the “primary duty,” or the most important role of their position.

If an employee meets these requirements, they are likely considered “exempt”, meaning their employer is not required to pay them the standard time and a half pay associated with overtime.

This exemption will help you plan for a comprehensive and competitive compensation package for your highly skilled employees without the concern for overtime pay. As a result, companies are able to afford in-demand skillsets while talented candidates have the opportunity to earn high wages in exchange for their services. The tech industry is thriving, and the government regulations covered by the FLSA are encouraging that growth for both employees and employers alike.

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