Antiquated Computer Employee Exemption May Get An Update

October 31, 2011

When it comes to technology, what was invented last week is seemingly an antique today. The same can be said for the Fair Labor Standards Act’s test for employees who are exempt under the Computer Employee Exemption. Section 13(a)(17) of the FLSA has set out that for an employee to be exempt under that test, and not be entitled to overtime, the employee’s primary duty must consist of:

• 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 design, documentation, testing, creation or modification of computer programs related to machine operating systems; or
• A combination of the aforementioned duties, the performance of which requires the same level of skills.

In an effort to update this test to reflect real world computer and information technology occupations, Senators Kay Hagan (D-NC), Johnny Isakson (R-GA), Mike Enzi (R-WY), and Michael Bennet (D-CO) introduced the Computer Professionals Update Act. This bill would apply the exemption to those who are “working in a computer or information technology occupation (including, but not limited to, work related to computers, information systems, components, networks, software, hardware, databases, security, internet, intranet, or websites) as an analyst, programmer, engineer, designer, developer, administrator, or other similarly skilled worker, whose primary duty is:

(A) the application of systems, network or database analysis techniques and procedures, including consulting with users, to determine or modify hardware, software, network, database, or system functional specifications;

(B) the design, development, documentation, analysis, creation, testing, securing, configuration, integration, debugging, modification of computer or information technology, or enabling continuity of systems and applications;

(C) directing the work of individuals performing duties described in subparagraph (A) or (B), including training such individuals or leading teams performing such duties; or

(D) a combination of duties described in subparagraphs (A), (B), and (C), the performance of which requires the same level of skill;

who is compensated at an hourly rate of not less than $27.63 an hour or who is paid on a salary basis at a salary level as set forth by the Department of Labor in part 541 of title 29, Code of Federal Regulations. An employee described in this paragraph shall be considered an employee in a professional capacity.

Wow, bipartisan legislation that actually makes sense! This bill has been referred to the Senate Committee on Health, Education, Labor and Pensions. We will continue to monitor this and keep you updated on its progress.