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Overtime Pay for California Computer Professionals and Hi-Tech Employees in Software and Hardware industries



The hi-tech culture has been known to embrace long hours driven by project deadlines or company policy requiring standards 60-70 hour workweeks. Under the California labor laws pertaining to high-tech employees and computer professionals (both in software and hardware industries), employees who work more than forty hours per week without additional compensation, may be owed for up to four years of overtime and other related statutory amounts. This could be in addition to owing matching contributions to 401(k)'s and stock options plans vested or accrued as a percentage of total compensation.

California Computer Professional Overtime

Employees who may be entitled to overtime pay include: High-tech employees and computer professionals (particularly those employed in IT, Software Engineers, Test Engineers, Quality Assurance Engineers, Senior Software Engineers, and Client Interface employees).

Computer OvertimeRecent class-action lawsuits against companies such as Electronic Arts and IBM have been settled on behalf of high-tech employees and computer professionals in software and hardware industries who are entitled to overtime. However, many employers still face additional lawsuits when they do not pay overtime as required by law.

The marketplace for high-tech employees and computer professionals has changed dramatically over the last twenty years. Case in point: there are a number of growing blogs and "gripe" sites on the internet confirming that high-tech employees and computer professionals have had enough. The following are some of the driving forces behind a growing trend of lawsuits against the technology industry (information obtained from a broad base of computer professionals fed up with the devaluation of their chosen profession):
  • The industry has abandoned the interests of the high tech and computer professional employee for the sake of shareholders.

  • The interests of high tech and computer professional employees are at the mercy of Wall Street forces that the individual employee has no control over. Therefore, market fluctuations can trigger reductions in force or mass lay-offs.

  • Competition and outsourcing to other countries has stripped high tech employees and computer professionals of valuable benefits that have diminished in scale and desirability as a result of profit margin squeezing (R&D and Labor Costs are primary forces driving Stock Price performance).

  • Market dynamics and trends in the industry over the last 20 years have diminished the value of a career in the Computer and Software Industry. Today, teenagers and individuals with nothing more than limited experience or a trade certificate command equal or higher compensation than graduates with Bachelor's degrees in electrical engineering and computer science from the top universities such as UC Berkeley, MIT, Caltech, and even those who have Master's degrees.

  • Many high tech companies abuse the profession arrogantly relying on the knowledge that it's an employers' market. If your company supplies cots, this might be a good sign that you are being taken advantage of. Does a cot and a fridge full of sandwiches and sodas justify the sacrifice?

  • Project driven deadlines only often lead to standardization of tasks and exert extreme pressure on team leaders to demand 70-90 work weeks without commensurate pay. Have you calculated actual hourly earnings based on working an average of a 60 hour work week? Divide weekly pay by the number of hours worked in a typical week. Under the law you would be entitled to overtime at the rate of 1/40 your weekly salary (yearly salary divided by 2080). Then you multiply that number by 1.5 to arrive at your overtime rate. Then you multiply that number by the overtime hours you work in a week and multiply it by the average number of work weeks (50 for most) to arrive at what your employer owes you for one year.

  • Under the law you can demand overtime for the last four years. This does not include penalties, compensation for un-provided meal and rest periods (one hour of wages up to two hours per day) for every day either was not provided, ERISA unmatched contributions, and more

  • Standardization and automation of systems and programs has made it possible to increase productivity from high tech and computer professionals in both software and hardware without the need to pay more. For example, most positions involving software and hardware testing are not exempt and must be paid overtime because routine tasks are performed within pre-defined parameters. In short, the more your duties are confined to templates and rote procedure, the greater the likelihood you are owed overtime. It isn't because you are not a professional; rather, it is because your high-tech employer is creating the illusion that you are a professional by bestowing you with a fancy title that ignores the true nature of what you do on a day to day basis.
There are two key areas to analyze in order to determine if a computer processional is entitled to overtime: method of pay and job duties.

Method of Pay

In order to be exempt in California, a full-time employee must earn at least $36 per hour. If you are salaried, this means you must earn at least $74,880 per year for a forty hour work week. If you work more than 60 hours per week, the minimum salary goes to $112,320. At 80 hours a week, it is$149,760. The minimum rate is higher for years prior to 2008 - as high as $49.77 per hour.

Duties

There are three different professional exemptions under California law and the federal statute: the learned professional, the creative professional and the computer professional. The computer professional (including computer programmer) exemption applies based on special-compensation requirements and skills.

In California it is required that an employee spend at least 50 percent of his or her time performing what are considered "exempt" duties in order to qualify as exempt. Therefore, a specific evaluation of an employee's daily responsibilities is essential.

If more than 50 percent of your time is spent writing code and you are salaried, you may be entitled to overtime pay. The California legislation states that "the individual must be highly skilled, with proficiency in the theoretical and practical application of highly specialized systems analysis, programming and software engineering."

In addition, if a work shift exceeds six hours, California employees must be given a half-hour break for lunch commencing prior to the end of the fifth hour (whether paid or unpaid), they must have a 10-minute rest break every four hours, and the employer must keep accurate and complete time records. Proper payroll taxes must be deducted. If an employer fails to comply, he or she may face significant penalties.

Companies need to exercise caution in their classification of workers as exempt from overtime. Classification of workers is scrutinized by the California Employment Development Department (EDD) and the Internal Revenue Service (IRS), and the penalties for misclassification are severe.

To ensure against misclassification, both for employees and employers, it is advisable to seek legal counsel who specialize or have succeeded in recuperating overtime against the high tech industry regardless if the company was a hardware or software company to determine if you (or your employees) are exempt.

California Software Development Professionals Legal Help

If you or a loved one has suffered damages in this case, please fill in our form on the right to send your complaint to a lawyer to evaluate your claim at no cost or obligation.
Last updated December 7 2018

Reader Comments


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I am employed by a Teamster benefits administrator. Our non-salaried employees are members of a local union and under the agreement between the company and the local, full-time hours are a maximum of 35 hours per week. I am a non-salaried employee and for years, have worked 35 hours per week. Since January 2008, my hours have increased to 40 hours per week plus 6 to 8 hours each and every Saturday. Though I understand I am a salaried employee, I have never been paid for hours worked above 40 hours per week. Is this legal?

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