Which means he is paying a lot less in income taxes, too. How that change has served to heighten the State's financial woes is another matter.The fact remains, however, that the software engineer makes the world go 'round these days. And yet, it appears as if he is taking home less.
It also appears, due to recent changes in overtime rates and exemption levels, that you, as a software professional, are beholden to your employer in more ways than you ever bargained for. You should be gaining ground, not losing.
But losing ground is what appears to be happening. Those of you at the higher end of the pay scale and used to being exempt from claiming overtime according to the old rules, may not completely understand the dismay of less-experienced software engineers who are paid, say, half of what you make. But they qualified for overtime, too, and given the extra hours often needed to turn a project around and work out the bugs, the OT check represented for many a welcome and in some cases lucrative payday.
But the exemption thresholds keep dropping, at the behest of employers who are more concerned about the bottom line than the human beings with bags under their eyes having stared so long at a monitor they can hardly see. Obviously, they have the ear of California legislators who keep lowering the bar. The result? You have fewer employees to whom an employer is required to pay overtime, and with the hourly rates of pay continuing to diminish in value, the amount of overtime is lower, too.
And now there is the $75,000 benchmark that came into play in September of last year. For 2009 that's up to $79,050 but it's still a far cry from what it used to be. If you are a computer professional in California and paid a salary of at least $79,050 per year, you are generally considered exempt from overtime unless you qualify for one of the non-exemptions, according to the work that you perform.
And careful—has your job been properly classified? Or is your employer trying to pull the wool over your eyes?
The cost of a misclassification can be staggering to you. How many hours of overtime do you contribute in any given week? Five to 15, for an integral member of the team is not uncommon. A few hours a day here, a few hours there. Maybe half of Saturday, to 'finish up.' Suddenly you're at 15. It adds up. Let's say you work an average of 10 hours of overtime a week. Knock off two weeks vacation a year (if you're lucky enough to get that), and you've just logged 500 hours of overtime you're not being paid just because you come in at the $79,050 per annum minimum benchmark.
If you qualified for overtime, your overtime rate at the $79,050 threshold is $56.91 per hour. Multiply that by 500 hours and you are missing out on $28,455 over the year that could be going into your pocket. For fun, look at the effective hourly rate: based on a strictly 40-hour week a salary of $79,050 translates to $37.94 per hour. However, based on a 50-hour week that effective hourly rates drops down a lot lower. At 60 hours per week it's even less. At 80 hours a week your hourly take-home packet may be comparable to someone working at a fast food joint.
Looking at 2007—which was the best year for computer IT professionals—would be enough to make your blood boil. The overtime exemption existed on a sliding upwards scale, according to the number of hours worked in a week. In 2007, if you were an IT professional or a software engineer you would have to be making $207,044 per year—based on an 80 hour week—in order to be exempt from earning overtime. In 2008 you started losing ground, and as of September of last year the 80-hour rate was the same as the 40-hour rate: $75,000. Imagine that. From $207,044 to a mere $75,000.
There's not much you can do about a statute that has been passed into law. But you do have tools at your disposal. For example, even if you were making in excess of $75,000 per year in 2008 prior to September 1st, depending upon how you fit into the sliding threshold scale, you could be in line for back overtime.
As well, you can still claim for work performed in the 4 years immediately prior to the exempt status changing. Thus, if you lost your non-exempt status with the new changes, it's still possible to collect owed overtime from the previous 4 years.
It is also possible that an employer may have robbed you of money based on a mistaken belief that the payment of an annual salary, so long as that salary was broken out to equal or exceed the old hourly thresholds, would mitigate the exemption. However, it has been pointed out that such a formula does not reflect the law at that time, and a chat with a qualified attorney could prove beneficial to you.
Yes, the economy is a huge worry right now and you are thankful to have a job. And yes, your employer has the right to get a fair weeks' work out of you at a fair wage. But a soft economy does not give an employer the right to take advantage of you, either. The employer may have a right to your professional time, but he doesn't own your personal life. The time you might normally spend with your family, or just time for you. To recharge. Animals that appear in films are treated with more respect than you are sometimes, and that isn't right.
READ MORE CALIFORNIA IT OVERTIME LEGAL NEWS
Remember that if you spend more than 50 percent of your time writing code and are paid on a salaried basis, you are probably entitled to overtime pay—either currently, or sometime during the previous 4 years.
Check it out with a qualified attorney to lead you forward. The statutes are complex. And besides, as a California software developer you have too much to do wading through a program that may reap millions for your employer and billions for those who buy it, to contemplate the complexities of overtime. But money is money, and if you're a California computer professional owed California IT overtime, check it out with a good California IT overtime lawyer. It could mean money in the bank. Lots of it…