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With the recent technology boom, the number of workers in computer-related positions and the types of computer-related positions has risen dramatically. Unfortunately, many employers are learning by way of lawsuits that employees in computer-related positions may not necessarily be salaried-exempt.
Misclassifying computer-related employees has proven costly for companies like Computer Services Corp. and Electronic Arts who have recently settled such claims for $24 million and $15.6 million, respectively. A class action lawsuit was recently filed in
California
against International Business Machines Corporation (IBM) seeking millions of dollars in overtime and other related violations on behalf of persons who were employed by IBM as technical support workers with primary duties of installing and/or maintaining computer software and hardware. According to the complaint, employees performed routine computer maintenance and installation services for IBM and its customers, following well-established company instructions and procedures, rendering those positions non-exempt. Given the suspected prevalence of misclassified workers in this area, the number of wage and hour lawsuits like the one filed against IBM will likely continue to rise.
In response to the above cases, employers should review the job classifications of their computer-related employees to ensure compliance with the wage and hour laws. Job titles are not determinative of eligibility for salary-exempt status. The professional exemption is only available to highly skilled employees who operate at a high level of proficiency in the areas of computer systems analysis, programming and software engineering. The employee’s primary duty must consist of one or more of the following:
- The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software, or systems 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 these duties requiring the same level of skills.
The exemption is not available to those employees who simply operate computers; who manufacture, repair or perform maintenance on computer hardware and related equipment; or whose work is highly dependent upon the use of computer and software programs, but who do not do systems analysis or programming.
In addition to reviewing whether computer-related employees are properly classified, all
Wisconsin
employers should be keeping time records for all computer-related positions, as required by the Wisconsin Administrative Code. Daily time must be recorded for all employees in
Wisconsin
, including salaried-exempt employees. If an employee is found to be misclassified, then the employer at least has a record of what hours were actually worked, even though not properly paid.
For more information regarding wage and hour or other employment law issues, please call our educational services department at (414) 423-1330 or e-mail kam@kclegal.com.
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