> HR is probably thinking that the company could make her salary so they do
> not have to pay overtime. Could be a costly mistake for the company...

Actually, that's not it at all - HR is the one who classified it as
hourly.  We're an HR outsourcing company (aka Professional Employer
Organization previously known as Employee Leasing company) and keeping
strict compliance with regulations internally is a big sticking point
for us.

The DOL link (thank you Erika) had the final answer:
Computer Employee Exemption
To qualify for the computer employee exemption, the following tests must be met:
• The employee must be compensated either on a salary or fee basis at
a rate not less than $455 per week or, if compensated on an hourly
basis, at a rate not less than $27.63 an hour;
• The employee must be employed as a computer systems analyst,
computer programmer, software engineer or other similarly skilled
worker in the computer field performing the duties described below;
• The employee’s primary duty must consist of:
1) The application of systems analysis techniques and procedures,
including consulting with users, to
determine hardware, software or system functional specifications;
2) 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;
3) The design, documentation, testing, creation or modification of
computer programs related to
machine operating systems; or
4) A combination of the aforementioned duties, the performance of
which requires the same level of
skills.
The computer employee exemption does not include employees engaged in
the manufacture or repair of computer hardware and related equipment.
Employees whose work is highly dependent upon, or facilitated by, the
use of computers and computer software programs (e.g., engineers,
drafters and others skilled in computer-aided design software), but
who are not primarily engaged in computer systems analysis and
programming or other similarly skilled computer-related occupations
identified in the primary duties test described above, are also not
exempt under the computer employee exempt

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