Are Software Devs Exempt from Overtime Laws?

Last updated on June 23rd, 2022 at 04:25 am

The tech press is full of articles about “crunch time,” with some software developers working 80 hours or more when it comes time to deliver a final product. Crunch time abounds in tech, but it’s especially common in areas like film-making and game development. The impact on the developer community is hotly debated.

For all the conversations about how crunch time causes burnout, however, there is one issue that’s just as significant: Whether or not developers are getting paid fairly under the law. Depending on where someone is in the United States, they may be exempt from overtime law for a variety of reasons.

And, of course, employers have a vested interest in employees thinking they are not entitled to overtime.

What the law says matters even more than ever. More software developers are working remotely, which further erodes labor protections when they find themselves responding to email or the team Slack late into the night. Both employers and personnel need to know exactly who is and isn’t exempt from overtime law.

Are Software Devs Exempt From Overtime Law? The Answer Is “It Depends”

Overtime law varies from state to state in ways that impact software developers.

From a business perspective, most employers may believe that by switching an employee to a salaried role, they are avoiding overtime pay completely. But that is not always the case, and acting as if it is can endanger the business as a whole, leaving it vulnerable to serious employment law claims.

What’s more, a firm that relies on underpaying devs for their work will soon have no devs!

Tech employees are well known for researching employment law and understanding their situation well so they can make informed career decisions. When it comes to overtime law, however, things are a bit murky. Let’s take an example that affects much of the tech world: The overtime law situation in California.

Overtime Laws For Technology Professionals In California

Across the United States, overtime pay is often known as “time and a half” because this is the rate at which it must be paid compared to the person’s usual hourly pay rate. Many types of workers become eligible for “time and a half” if they work more than eight hours in one day or more than 40 hours in a week.

There are common exceptions, such as working for four 10-hour shifts on a regular basis.

Some states, including California, have more complex rules. The goal of the regulatory scheme in California is to strengthen protections for white-collar workers who might otherwise be considered exempt from overtime pay.

Under California law, a computing professional’s hourly salary must be above a specific amount to be overtime-exempt. This amount is adjusted annually, with changes going into effect on October 1. In 2021, the cutoff was $47.48 per hour or $98,907.70 per year. It rose $7.10 per hour compared to 2014.

In addition, a duties test is applied.

People whose salary exceeds the limits may still be eligible for overtime based on the details of their regular work, known as the duties test. Several elements of the duties test can be challenging to interpret. Employment lawyers are often consulted by both workers and employers to understand where and when they apply.

For example, exempted individuals must exercise “discretion and independent judgment” regularly.

A Simpler Example: Overtime Laws In Nevada

Nevada law creates some exceptions to overtime that don’t require employment lawyers to figure out!

In fact, there are ten whole categories of personnel who are exempt from receiving overtime.

The general effect of Nevada overtime law is to employers’ benefit.

However, unlike in many other states, Nevada state laws does not carve out a specific exemption to overtime law that applies to software developers or computer programmers. Nor are computer programmers considered administrative or professional employees, two categories that do have an exemption.

Some examples of personnel who are often or always considered to be eligible for overtime in Nevada include tradespeople (carpenter, electricians, plumbers), longshoremen, construction workers, police officers and other law enforcement officers, park rangers, paramedics, and firefighters.

Here Is The Biggest Exception To Overtime Law in Nevada

Many Nevada business owners will be relieved to know that all employees of businesses with a gross sales volume of less than $250,000 are exempt from overtime protections. That makes many software devs working for small firms exempt from receiving overtime in Nevada.

Just like employees, business owners should not assume they know everything about the law. Consulting with Las Vegas employment lawyers could be necessary, for example, because municipal laws can affect pay rules.

Overtime can make a difference of thousands of dollars a year for software dev. Knowing the rules helps everyone to avoid unpleasant surprises and get fair compensation for important, highly skilled work.