Most people know the minimum wage increases in California on January 1st. Employers with 26 or more employees must pay at least $12.00 per hour. Employers with fewer employees must pay at least $11.00 per hour. Other workers must also receive increased pay for the new year.
Minimum Salary for “White Collar” Exemptions
Most employees in California are entitled to overtime pay unless the employees meet one or more exemptions. Most exemptions require the employee to receive a salary equal to two times the state’s minimum wage. Since California’s minimum wage increases on January 1st, so did the minimum salary for most exempt employees.
Employees covered by the administrative, executive, and/or professional exemptions must receive a salary of at least $49,920 per year if the employer has more than 26 employees. If the employer has 25 or fewer employees, the employees must receive at least $45,760 per year. for employers with 25 or fewer employees. Keep in mind, the salary test is only part of the exemption requirement. The employee must also spend most of his/her time performing exempt work.
Exempt Software Professionals
Certain software professional may be exempt from California’s overtime requirements if they meet certain qualification. “Software professionals” generally covers many software engineers, programmers, developers, analysts, and others performing software development related work.
Rather than the typical “Two Times Minimum Wage Salary Requirement” applicable to most exemptions, software workers have a higher minimum salary requirement and can be paid an hourly wage. The DIR increases the minimum payment every year based on the California Consumer Price Index.
Effective January 1, 2019, the new minimum wage increases for an exempt computer software professional from $90,790.07 to $94,603.25 per year (from $7,565.85 to $7,883.62 per month). The minimum hourly rate increases from $43.58 to $45.41.
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Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.
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