Tuesday, July 17, 2012

Supremes say pharma reps are exempt under FLSA

U.S. Supreme Court Holds that Pharmaceutical Sales Representatives are Exempt from Overtime under the Fair Labor Standard Act's Outside Sales Exemption

In Christopher v. Smithkline Beecham Corp., 132 S. Ct. 2156 (June 18, 2012), the U.S. Supreme Court held, in a 5-4 decision, that pharmaceutical companies are not required to pay overtime to their sales representatives.

The key issue in the case was whether the pharmaceutical sales representatives fell within the Fair Labor Standards Act's ("FLSA") outside sales exemption. By law, pharmaceutical representatives cannot sell drugs. As a result, the sales representatives simply secure non-binding commitments from physicians to prescribe their companies' drugs in appropriate circumstances.

More on the U.S. Supreme Court's decision.

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