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Risks in Misclassifying Employees as Exempt from Overtime Pay

Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for above-the-bar-logo-no12.jpgQ: I own a computer software company in New York and employ many people performing different types of jobs, most of who work overtime. How do I determine who is exempt and non-exempt from the minimum wage and overtime laws?

A: The Fair Labor Standards Act (“FLSA”) and the New York State Labor Law requires employers in New York State to pay employees at least the minimum wage hourly rate of $7.25 and overtime pay at 1 ½ times the regular rate of pay for hour worked in excess of 40 hours a week. The FLSA exempts certain workers from this minimum wage and overtime pay requirements. In order for an employee to qualify as being exempt, he or she must meet certain job criteria as well as salary requirements. You cannot simply give an employee the job title of “Manager” to avoid paying them overtime.

Generally, in order to classify any of your employees as exempt computer employees, they must meet the following requirements:

  • You must compensate your employee with a salary or pay then at least $455 a week. If you pay them hourly, you must pay them at least $27.63 an hour; and
  • The employee must be one of the following: a computer systems analyst, computer programmer, software engineer, or a worker with similar computer skills whose primary duties include the following:
    1) the application of systems analysis techniques and;
    2) design, development, documentation, analysis, creation, testing or modification of computer systems or programs;
    3) design, documentation, testing, creation or modification of computer programs related to machine operating systems; or
    4) combination of the above duties which requires the same level of skills.

The computer exemption does not apply to employees whose jobs involve the manufacture or repair of computer hardware.

In this day of government crackdowns and rising wage and overtime lawsuits, it is financially imperative that you correctly classify your employees. Make sure that the job title and classification you give corresponds to the employee’s job function. Most important, make sure you periodically review your employee’s job functions, which might have changed, with their classification. An employee’s classification can change over time as duties evolve. Contact our New York Misclassification of Employees Attorneys at Villanueva & Sanchala at (800) 893-9645 to help you properly classify your employees and defend against any potential lawsuits or to learn if you have been misclassified.


Thank you for visiting our Blog. This blog provides general information and thoughts about various employment law issues primarily in the New York Tri-State area and occasionally in other areas. You are welcome to read the posts. However, do not construe any content on this blog as legal advice or the creation of an attorney-client relationship. Again, we provide the content only for informational purposes. You should not make decisions based information on our blog since the application of the law depends on the facts and each situation may be different. In addition, the law in most jurisdictions is different and changes constantly and we make no representations that any information on our blog has been updated. The Blog should not be used as a substitute for competent legal advice from an experienced employment law attorney in your state or jurisdiction.

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