Christopher v. SmithKline Beecham Corp. (11-204)
November 28, 2011
Case #: 11-204
635 F.3d 383 (9th Cir. 2011)
Full Text Opinion: http://www.bloomberglaw.com/public/document/Christopher_v_Smithkline_Beecham_Corp_635_F3d_383_9th_Cir_2011_Co
Administrative Law: (1) Whether deference is owed to the to the Secretary of Labor’s interpretation of the Fair Labor Standards Act’s sales exemption; and (2)whether the FLSA’s outside sale exemption applies to pharmaceutical sales representatives.
The Pharmaceutical industry regularly considers pharmaceutical sales representatives (PSRs) as outside sales employees. Outside sales employees is a class that is exempt from the overtime provision protections of the Fair Labor Standards Act (FLSA). In the amicus brief filed in the Second Circuit in Novartis Pharm. Corp. v. Lopes, 611 F.3d 141 (2d Cir. 2010), the Department of Labor interprets PSRs as non-exempt and entitled to overtime pay. The Second Circuit deferred to the DOL’s interpretations concluding that PSRs do not make sales and are, therefore, not outside salesmen.
Michael Christopher and Frank Buchanan, both PSRs, filed suit under the FLSA seeking overtime pay on behalf of the PSR class employed by SmithKline Beecham Corp. (dba GSK). The Ninth Circuit did not defer to the DOL in its decision and instead concluded that PSRs qualify for the FLSA exemption even though other industry regulation limits PSRs from making traditional sales.