Source: http://thecomplexlitigator.com/post-data/tag/Exemptions
Timestamp: 2019-04-19 04:51:21+00:00

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Christopher et al. v. Smithkline Beecham Corp., dba Glaxosmithkline holds, 5-4, that pharma sales reps are exempt as "outside salespersons"
The United States Supreme Court, in Christopher et al. v. Smithkline Beecham Corp., dba Glaxosmithkline (June 18, 2012), examined the question of whether pharmaceutical sales representatives, whose primary duty was to obtain nonbinding commitments from physicians to prescribe their employer’s prescription drugs, were correctly classified as exempt from overtime pay requirements set forth in the Fair Labor Standards Act. In the courts below, defendant moved for summary judgment, arguing that plaintiffs were “employed in the capacity of outside salesman,” §213(a)(1), and therefore were exempt from the FLSA’s overtime compensation requirement. The District Court agreed and granted summary judgment to defendant. Plaintiffs filed a motion to alter or amend the judgment, contending that the District Court had erred in failing to accord controlling deference to the DOL’s interpretation of the pertinent regulations, which the DOL had announced in an amicus brief filed in a similar action. The District Court rejected this argument and denied the motion. The Ninth Circuit, agreeing that the DOL’s interpretation was not entitled to controlling deference, affirmed.
The opinion was decided on sharply divided 5-4 lines, with one majority opinion and one minority opinion. The opinion considered three of the DOL’s regulations: §§541.500, 541.501, and 541.503. The Court referred to the three regulations as the “general regulation,” the “sales regulation,” and the “promotion-work regulation,” respectively.
First, the majority observed that the DOL’s own interpretation of its regulations was not consistent over time. In briefs filed before the Second and Ninth Circuits, “the DOL took the view that ‘a “sale” for the purposes of the outside sales exemption requires a con- summated transaction directly involving the employee for whom the exemption is sought.’” Slip op., at 9. After certiorari was granted in this matter, the DOL took the position that “ ‘[a]n employee does not make a “sale” for purposes of the “outside salesman” exemption unless he actually transfers title to the property at issue.’ ” Slip op., at 9.
Until 2009, the pharmaceutical industry had little reason to suspect that its longstanding practice of treating detailers as exempt outside salesmen transgressed the FLSA. The statute and regulations certainly do not provide clear notice of this. The general regulation adopts the broad statutory definition of “sale,” and that definition, in turn, employs the broad catchall phrase “other disposition.” See 29 CFR §541.500(a)(1). This catchall phrase could reasonably be construed to encompass a nonbinding commitment from a physician to prescribe a particular drug, and nothing in the statutory or regulatory text or the DOL’s prior guidance plainly requires a contrary reading. See Preamble 22162 (explaining that an employee must “in some sense” make a sale); 1940 Report 46 (same).
Slip op., at 12. Then the majority noted that, despite the industry’s decades of applying an exempt classification, the DOL never initiated any enforcement action.
This new interpretation is flatly inconsistent with the FLSA, which defines “sale” to mean, inter alia, a “consignment for sale.” A “consignment for sale” does not involve the transfer of title. See, e.g., Sturm v. Boker, 150 U. S. 312, 330 (1893) (“The agency to sell and return the proceeds, or the specific goods if not sold . . . does not involve a change of title”); Hawkland, Consignment Selling Under the Uniform Commercial Code, 67 Com. L. J. 146, 147 (1962) (explaining that “‘[a] consignment of goods for sale does not pass the title at any time, nor does it contemplate that it should be passed’” (quoting Rio Grande Oil Co. v. Miller Rubber Co. of N. Y., 31 Ariz. 84, 87, 250 P. 564, 565 (1926))).
Minority slip op., at 6. The minority concluded by dismissing the majority’s fears that a salesman who takes an order would suddenly become non-exempt by transferring the order to jobber’s employee to be filled. The minority noted that the example created no basis for fear, given that the salesman had obtained a firm commitment to buy the product. Regardless of the quality of the counter-arguments, the minority opinion by Justice Breyer is just that, a minority opinion, and "sales" are evidently in the eye of the beholder.
District Court decertifies class of customer service representative employed by Safety-Kleen Systems, Inc.
United States District Court Judge Phyllis J. Hamilton (Northern District of California) granted Defendant Safety-Kleen Systems, Inc.'s motion to decertify a class of "customer service representatives." Wamboldt v. Safety-Kleen Systems, Inc., 2010 WL 3743925 (N.D. Cal. Sept. 20, 2010). The CSRs had duties extending well beyond what one might expect from the job title, including customer sales, client collections, and various telephone responsibilities, as well as on-site servicing of equipment, transportation of hazardous waste, and driving of company vehicles in order to perform customer service calls. The hazardous waste transportation and the occasional use of large vehicles (in excess of 30,000 lbs. gross vehicle weight) were the primary culprits underlying the motion to decertify.
I briefly direct your attention to Pellegrino v. Robert Half International, Inc., in which the Court of Appeal (Fourth Appellate District, Division Three) affirmed a trial court judgment that invalidated a contractual agreement purporting to shorten statutes of limitation for wage & hour claims and decided an equitable defense of "administrative exemption" before the jury phase of the trial.

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