If you haven’t been confused about the Computer Exemptions under the Fair Labor Standards Act (FLSA) you may be the only one. The FLSA exemption tests, used to determine who must be paid overtime (nonexempt) and who doesn’t (exempt employees), have confused most of us for a long time. The FLSA was passed in 1938 and has had a hard time keeping pace with the world in the last 70 years. Positions that didn’t exist in the 1930s are particularly hard to classify, with computer jobs being especially troublesome.
For a long time certain high level computer employees could be classified as exempt under the FLSA’s traditional professional exemption (section 13(a)(1) if they were paid on a salary basis and met certain job duty tests. A 1990 amendment permitted hourly computer professionals to be treated as exempt if paid at 61/2 times the minimum wage. In 1996 a specific exemption for computer professionals was created which also froze the required hourly rate at $27.63 (section13(a)(17). Regulations were consolidated and “simplified” again in 2004.
That left many of us wondering how do the salary test (13(a)(1) and the hourly test (13(a)(17) interrelate? Are they mutually exclusive? While the mental challenge of trying to figure this out could be rewarding enough, the issue is especially important given the pay rates of IT professionals and the tendency for them to work long hours. Consequently, organizations are especially interested in treating them as exempt employees.
As you may have guessed, the DOL has released more “clarification” in a bulletin that attempts to explain the relationship between the two exemptions. The Agency says that it didn’t intend to create a dichotomy between the two tests. Therefore both sections (13(a)(1) and 13(a)(17) provide an overtime exemption for systems analysts, programmers, software engineers and similar employees who meet the job duties test and are either paid on a salary of not less than $455/week or not less than $27.63/hour.
If for some bizarre reason you’d like to read more go to: http://www.dol.gov/esa/whd/FieldBulletins/FieldAssistanceBulletin2006_3.pdf.