United States Supreme Court Rules on Wage and Hour Case

1330873_27868463.jpgAs California wage and hour lawyers we read with interest the United States Supreme Court’s opinion in Christopher v. SmithKlineBeecham Corp., in which the Court recently determined that pharmaceutical sales representatives, also referred to as “detailers,” come within the “outside salesman” exemption to the Fair Labor Standards Act (FLSA). This result means that these workers are not entitled to receive overtime wages.

As our readers are aware, the FLSA requires that employers compensate certain employees with overtime pay. Employees considered “outside salesmen” are not entitled to this benefit. The definition of this class of employees has been left to the Department of Labor and in this case, the Court had to determine whether the pharmaceutical detailers are in fact “outside salesmen” as defined by the DOL regulations.

In the case before the court, the workers sought additional pay when working outside the normal 40 hour work week. The case is unusual because the pharmaceutical industry is so highly regulated, the detailers may only visit physicians to seek their non-binding commitment to prescribe the drugs they make. They don’t make sales in the traditional sense of a sales activity in which an actual sale is made. The detailers not only visit doctors’ offices, they also provide other information to medical personnel through various events to make them aware of the drugs their companies have to offer them for prescriptions to their patients.

These detailers had been receiving a base salary and incentives, but no overtime pay and they sued to get that. The Ninth Circuit Court of Appeals determined that the detailers were in fact outside salesmen and were therefore not entitled to receive overtime pay. They arrived at this result using various lines of reasoning and interpretation which led the Court to determine that the pharmaceutical detailers are not entitled to the overtime pay that might otherwise be provided. They do fall within the outside salesmen exemption.

But Justice Breyer dissented, first voicing his agreement with the way the Court described the detailers’ job functions along with the conclusion that the DOL’s interpretation of its own regulations should not carry particular weight. However, he would reach a different result in that because the detailer’s do not technically make sales, and rather are tasked with promotion of the drugs, they are not outside salesmen and do not fall within the overtime pay exemption. He believes they should receive the overtime pay given the law and the nature of their jobs.

Often employers do not pay what employees are entitled to receive based on the nature of their jobs. We have successfully challenged employers who are not providing overtime pay or other employment benefits to their workers. If you have any questions about your wages, classification or other employment concerns, please contact the San Francisco employee rights law firm of Hersh & Hersh. With over four decades of experience in supporting consumers, the injured and employees who have been harmed by their employers, we can help. Contact our law offices for a free consultation with one of our experienced lawyers.