Overtime and Pharmaceutical Reps

Can an employer deny overtime pay to pharmaceutical reps? 

     Perhaps not. A few courts have recently held that pharmaceutical reps do not qualify for the commissioned sales exemption to the Fair Labor Standards Act. The basis of these holdings is that pharmaceutical reps do not actually sell anything. Usually they visit doctors and hospitals and inform the doctors about the drugs and encourage them to write prescriptions for the drug. The actual purchase and sale occurs when a patient buys the drug from a pharmacy. In this way, no actual sale occurs when the rep visits the doctor. Furthermore the reps income is not directly connected to the sale of the drugs. Usually they receive bonuses based upon overall sales in their geographic territory.

     The take away is that the FLSA is strictly and narrowly construed in favor of employees and an employer’s classification is not always right.

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