What is considered an exempt employee?

An exempt employee is a person employed in California who is not subject to the state’s wage and hour laws. Exempt employees include executive, administrative, and professional employees, as well as outside salespersons, certain computer professionals, and certain farm workers. Executive employees must have at least two of the following criteria; primary duty is to manage the enterprise or a customarily recognized department or subdivision; customarily and regularly direct the work of two or more other employees; authority to hire and fire other employees or to change their status; and customarily and regularly exercise discretion and independent judgment. Administrative employees must have at least two of the following criteria; primary duty is to perform office or non-manual work directly related to management policies or general business operations; primary duty includes the exercise of discretion and independent judgment; primary duty includes the performance of work requiring advanced knowledge; and primary duty includes the performance of work commonly called “brain work”. Professional employees must have at least two of the following criteria; primary duty is to perform work requiring knowledge of an advanced type in a field of science or learning; primary duty includes the exercise of discretion and independent judgment; primary duty includes regularly engaging in invention, anticipation, and/or evaluation; and primary duty includes the consistent exercise of discretion and independent judgment. Outside salespersons are exempt if their primary duty is making sales or obtaining orders or contracts for services, and they are customarily and regularly away from the employer’s place of business. Computer professionals are exempt if their primary duty is to apply systems analysis techniques and procedures, including consulting with users to determine hardware, software, or system functional specifications, and they are highly skilled computer programmers. Certain farm workers are exempt if their primary duty is the cultivating and harvesting of agricultural products and they are paid on a piece-rate basis.

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