SmithKline Beecham Dodges Bullet

Pharmaceutical Representatives have long argued that they are entitled to overtime, working long hours with little authority to do much other than recommend products, and the Department of Labor has supported that view in its written opinions. But the pharmaceutical industry has refused to comply, arguing that those representatives are subject to the outside salesman exemption from overtime, regardless of whether they are allowed to actually sell anything at all. Now, thanks to the Supreme Court, the pharmaceutical industry is safe.

In a split decision, with Justice Samuel Alito (joined by Chief Justice Roberts, and Associate Justices Antonin Scalia, Clarence Thomas and Anthony Kennedy) writing for the 5-4 majority, the Supreme Court found that the outside sales exemption covers SmithKline’s pharmaceutical sales reps. The Court found persuasive, among other things and despite the DOL’s opinions, “the fact that approximately 90,000 pharmaceutical reps throughout the United States would be potentially affected by an adverse decision, creating substantial and unexpected back pay liability for the pharmaceutical industry.”

If you’re working long hours, without overtime pay, call us. The outside sales exemption is not your only protection.