New Minimum Hourly Rates for Exempt Computer Software and Licensed Physicians and Surgeons

By Deborah H. Petito

The minimum hourly rates for computer software professionals and licensed physicians and surgeons was announced by the Department of Industrial Relations (“DIR”). Effective January 1, 2017, the rates are as follows:

Physicians – $77.23 per hour. Previously, the hourly rate was $76.24 (the DIR does not set monthly or annual minimums for physicians and surgeons.

Computer Software Professionals – $42.39 per hour, $7359.88 per month and $88,318.55 per year. Previously, the rates were $41.85 per hour, $7,265.43 per month and $87,185.14 per year. A computer software professional must meet the following criteria in order to be exempt under the professional exemption:

  • The employee is primarily engaged in work that is intellectual or creative and requires the exercise of discretion and independent judgment.
  • The employee is primarily engaged in duties that 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 system functional 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 documentation, testing, creation, or modification of computer programs related to the design of software or hardware for computer operating systems.
  • The employee is highly skilled and is proficient in the theoretical and practical application of highly specialized information to computer systems analysis, programming, and software engineering. A job title shall not be determinative of the applicability of the exemption.

Also, remember that the Department of Labor’s Final Rule on exempt employees is effective December 1, 2016 and requires that all exempt employees be paid at least $46,467 annually in order to be exempt. This is higher than current California law (except in some cities where the minimum wage is higher. You can read more on this topic in my blog article posted in May. Will Your Exempt Employee Still Be Exempt?

Thank you for joining us on ClarkTalk!  We look forward to seeing you again on this forum.  Please note that the views expressed in the above blog post do not constitute legal advice and are not intended to substitute the need for an attorney to represent your interests relating to the subject matter covered by the blog.  You should certainly consult legal counsel of your choice if you need assistance in determining whether or not an employee is exempt or whether they are being paid appropriately.  If you wish to consult with the author of this post or another attorney at Clark & Trevithick, please contact Debbie Petito or Leonard Brazil by email at or telephonically by calling the author at (213) 629-5700.

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