On June 18th, 2012, in Christopher v. SmithKline Beecham Corp., (The US Supreme Court, No.11-204), held that pharmaceutical sales representatives are outside salesmen and therefore they are not entitled under the Fair Labor Standards Act (FLSA) to overtime compensation.
In SmithKline, the plaintiffs were hired as pharmaceutical sales representatives by the defendant. They spent 40 hours a week calling doctors and another 10-20 attending events. The plaintiffs never received overtime if they worked over 40 hours a week. They brought suit under the FLSA for failure to receive overtime. The district court granted summary judgment for the defendants. The Ninth Circuit affirmed the district court's ruling.
The US Supreme Court affirmed the Ninth Circuit's ruling. The plaintiffs argued that under the Department of Labor's (DOL) interpretation of their regulations they were not outside salesmen. The DOL's interpretation was that an employee does not make a sale unless the title of the property is transferred. The Court found that this interpretation lacked thorough consideration and that the FLSA was not intended to protect employees like the plaintiffs.
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