|August 5, 2014|
Previously published on August 4, 2014
In an April 2014 decision in the Southern District of New York, Olorode v. Streamingedge, Inc., No. 11 Civ. 6934 (GBD) (AJP) (S.D.N.Y. Apr. 29, 2014), employers were given some clarification on the Computer Professional overtime exemption available under the Fair Labor Standards Act (“FLSA”). As courts in the Second Circuit have not often had occasion to expound on the Computer Professional exemption, this decision will be helpful going forward in understanding which computer- or technology-based employee positions likely will qualify for this exemption and which likely will not.
By way of background, the FLSA exemption for computer professionals applies to any employee whose primary duty is:
(A) the application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software, or system functional specifications;
(B) 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;
(C) the design, documentation, testing, creation, or modification of computer programs related to machine operating systems; or
(D) a combination of duties described in subparagraphs (A), (B), and (C), the performance of which requires the same level of skills, and who, in the case of an employee who is compensated on an hourly basis, is compensated at a rate of not less than $27.63 an hour.
29 U.S.C. § 213(a)(17). Employees fitting within this provision are exempt from overtime under the FLSA.
In Olorode, Magistrate Judge Peck issued a Report and Recommendation which denied, among other things, plaintiff Taiwo Olorode’s FLSA and New York Labor Law claims for unpaid overtime under the FLSA’s Computer Professional exemption. Olorode had been hired by Streamingedge, a technology company which provides processing systems and products to financial brokers and traders, as a Systems Support Analyst. His job responsibilities included systems analysis, software research and development, support, maintenance and testing, networking, and site installations assistance, as well as “designing and maintaining the proper operation of the trading platform used” by Streamingedge’s investment brokers. Olorode also came to the position at Streamingedge with multiple certifications and training in computer science and information systems, as well as over ten years’ experience in similar positions in his field.
Olorode claimed that he often worked in excess of 12 hours per day, and regularly in excess of 60 hours per week. He also claimed that much of that additional time was caused by having to perform duties not related to his position as a systems analyst. The court, however, was not convinced, and it found his long hours did not warrant any overtime premium payment because his position was an exempt one. Chiefly, the court compared Olorode’s skills and training, his job description, and the critical role his worked played in Streamingedge’s overall functionality to earlier Southern District decisions on this exemption (namely Clarke v. JPMorgan Chase Bank, N.A., No. 08 Civ. 2400 (CM)(DCF) (S.D.N.Y. Mar. 26, 2010), and Bobadilla v. MDRC, No. 03 Civ. 9217 (S.D.N.Y. Aug. 24, 2005)), as well as to the four elements of the Computer Professional exemption laid out under federal law. Olorode’s technical certifications were given weight in finding his position exempt; the job duties of the position Olorode filled were very similar to the other positions found to be exempt in Clarke and Bobadilla; and Olorode himself had attested that his work was critical to his employer’s functionality-thus satisfying the court that the position qualified for the Computer Professional exemption.
As companies are increasingly becoming more technologically savvy and reliant upon computer professionals, positions classified as exempt under the Computer Professionals exemption may be appearing more often in workplaces not traditionally thought of as tech-based. In particular, as employers are requiring more than just a Help Desk for the most basic of computer maintenance, we will be seeing computer professional positions providing critical network and software support to even the most basic of businesses in the near future. The Olorode decision helps to clarify that such critical technological support will certainly be a factor in finding that such employees qualify for the Computer Professionals exemption.
If you have questions about these or any other employee overtime exemptions under the FLSA or state law, please consult with counsel. We will continue to update you on these exemption clarifications as they arise.