California Labor Law: Not All Computer Programmers Exempt from Overtime

San Francisco, CAAs the technology industry grows and changes, employers are increasingly called on to classify employees as either exempt or nonexempt from overtime pay according to California labor laws. Although there are guidelines regarding which employees can be considered exempt from overtime pay, employers still misclassify employees, denying some people well-deserved overtime pay.

Yet another high profile company accused of violating California labor law has reached a settlement with its employees. Sony Computer Entertainment America (also known as Sony or SCEA) agreed to pay plaintiffs in the class action lawsuit $8.5 million.

The suit, which involved Sony workers known as "Image Production Employees" who worked for the company between February 11, 2001 and September 25, 2007, was led by a former employee who claimed he was improperly classified by Sony so that he would be considered exempt from overtime. According to court documents the suit sought "statutory penalties, damages, punitive damages, restitution, and injunctive relief."

The lawsuit stated that Image Production Employees are "closely supervised in the performance of their duties, receiving specific instructions and specifications with respect to minute details..." and "Image Production Employees do not have management responsibilities." Therefore, the employees should have been paid overtime under California labor law because computer programmers are considered exempt from overtime pay only if their work is intellectual or creative and requires the exercise of discretion and independent judgment, in addition to meeting other requirements.

The lawsuit alleged that Sony acted "maliciously, oppressively, and/or fraudulently" with the intention of maximizing the company's economic gain with willful disregard to the rights of its employees. In addition to the $8.5 million, Sony will reclassify class members with the job title "Associate Artist" and "Artist 1" so they will be eligible for overtime pay.

Two other video game companies also faced class action suits in the past two years. Both Electronic Arts, which settled its lawsuit for $14.9 million, and Activision faced claims that they violated California labor laws by failing to properly compensate employees for overtime work.

According to the website of the State of California, nonexempt employees, "...shall not be employed more than eight hours in any workday or more than 40 hours in any workweek unless he or she receives one and one-half times his or her regular rate of pay for all hours worked over eight hours in any workday and over 40 hours in the workweek." Furthermore, employees who work more than 12 hours in a day are eligible for double their regular rate of pay.

Employers are also required to pay overtime even if the overtime was unauthorized, provided the employee did not deliberately prevent the employer from knowing about the overtime work. However, if the employer knew or should have known about the overtime, regardless of whether it was authorized, the employee is eligible for overtime pay. An employee cannot waive his or her right to overtime compensation.

If you believe you have been misclassified as exempt and not properly paid for overtime hours worked in violation of California labor law, contact a lawyer to discuss your options. Check back here for more news and developments regarding California labor law...