Effective January 1, 2025, California employers must ensure that compensation rates for computer professionals meet new salary thresholds to qualify for the California computer professional exemption. Beginning in 2025, computer professionals in California must be paid an annual salary of at least $118,657.43 ($9,888.13 per month) or an hourly rate of $56.97 for every hour worked.
In addition to meeting this salary requirement, computer professionals must satisfy the duties test outlined in Labor Code Section 515.5, which includes exercising discretion and independent judgment while performing work that is intellectual or creative in nature.
The primary responsibilities of a California computer professional must include at least one of the following:
- Applying systems analysis techniques and procedures, including consulting with users, to determine hardware, software, or system-functional specifications.
- Designing, developing, documenting, analyzing, creating, testing, or modifying computer systems or programs, including prototypes, based on user or system design specifications.
- Documenting, testing, creating, or modifying computer programs related to the design of software or hardware for operating systems.
Additionally, the computer professional must be highly skilled and proficient in the theoretical and practical application of specialized knowledge in computer systems analysis, programming, or software engineering. The changes in the compensation threshold do not alter these duties tests, and certain duties remain excluded from the exemption under the Labor Code.
Notably, California’s requirements for the computer professional exemption differ from the federal Fair Labor Standards Act (FLSA). Under the FLSA, employees in computer-related occupations must meet the salary threshold for executive, administrative, and professional roles, or, if paid hourly, receive a minimum of $27.63 per hour.
Next Steps
Employers should evaluate the pay rates of their computer professionals before January 1, 2025, to ensure compliance with the new salary threshold. Adjustments in compensation or reclassification of employees to non-exempt status (entitled to overtime pay) may be necessary.
It’s important to remember that the salary threshold is only one aspect of the exemption. Computer professionals must also meet the duties test as defined by California law. Employers must adhere to the law that offers the highest salary threshold when federal, state, or local requirements differ.
HR Works Can Help
Current HR Works’ Virtual HR Helpline subscribers have unlimited access to answers to questions about the proposed FLSA exempt salary increase, as well as other HR and employment law topics, and 24/7 access to HR Works’ attorney-reviewed online compliance resource center (Comply), which offers human resources tools, forms, and other compliance resources. Additionally, Virtual HR Helpline subscribers receive two free FLSA Assessments each year (with the option to purchase additional assessments for a fee). The HR Helpline can be reached at hrhelp@hrworks-inc.com or by calling 888-668-1271.
HR Strategic Services clients may contact their designated HR Consultant for additional guidance and assistance with these changes and/or to request FLSA Assessments.
Non-HR Works clients may contact us for HR solutions by calling toll-free at 1-877-219-9062 or visiting our website.
