The U.S. Supreme Court ruled on Monday in favor of the pharmaceutical company GlaxoSmithKline, which was being sued by two former company representatives asking for overtime pay for selling products at doctors’ offices. Michael Christopher and Frank Buchanan alleged that they worked ten to twenty hours on average each week outside of the normal business day, yet received no additional money for their labor. However, because company representatives are paid a base salary and commission based on performance, Glaxo maintained that they were not entitled to overtime pay. Under the federal Fair Labor Standards Act, companies are required to pay employees for working overtime, though there are numerous exemptions against this — including workers classified as “outside salesmen.” With this decision, the Court has set a precedent: commission-based workers now count as outside salespeople, and therefore are exempt from overtime laws.
What this means, then, for the average commission-based worker is that overtime does not necessary correlate to an increase in monthly salary earned. It may not seem fair, but it is the law.
What are your thoughts?