Pharmaceutical Sales Reps Qualify for “Outside Salesmen” Overtime Exemption.

Although the Pharmaceutical industry has long treated their sales reps as outside sales persons, exempt from the FLSA’s overtime requirements, a recent  shift in the DOL’s interpretation of its regulations raised the question whether such persons actually complete “sales” in a manner necessary to gain the exemption.  Resolving a split in the Circuits, the Supreme Court upholds the traditional interpretation that “sales” include related promotional activities, thereby permitting the exemption.  As held by the Court, a sudden change in the DOL’s interpretation and enforcement of the “sales” term without fair notice and public comment would subject an entire industry to undue liability for prior practices implicitly sanctioned by the DOL.   See Christopher v. SmithKline Beecham Corp., (Supreme Court 2012).

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