Novartis Sales Rep Overtime New York

Although New York pharmaceutical sales representative jobs have traditionally been considered exempt from overtime pay, recent lawsuits involving New York Novartis sales representatives challenge that exemption. The courts, supported by the Department of Labor, have found that Novartis sales reps do not have authority or discretion in their job and are not directly involved in selling the product. Recently, the Supreme Court refused to hear an appeal of rulings in favor of New York Novartis sales representatives, meaning Novartis will have to pay overtime wages.

Under the Fair Labor Standards Act (FLSA), employees are entitled to overtime pay for working more than 40 hours in a workweek. People who are involved in outside sales, however, are typically considered exempt from overtime pay. That is because employees who work in outside sales have unlimited earning potential due to their commissions—the more they sell, the more money they can make. Furthermore, they often work independently from a main office and have discretion in what hours they work.

For a long time, New York pharmaceutical sales representatives were considered exempt from overtime pay. They could be considered exempt on one of two counts: either as outside sales people or under the administrative exemption, if they have discretion and authority in their job.

Some recent lawsuits, however, have resulted in the courts determining that pharmaceutical sales reps are not exempt from overtime pay—that is, they should be paid overtime for their hours worked—because they do not fall under either the outside sales exemption or the administrative exemption.

A lawsuit filed against Novartis alleged that Novartis sales representatives should be paid overtime because they do not meet the requirements for overtime exemption. The Second Circuit Court of Appeals agreed with the Novartis pharmaceutical sales representatives, finding that the Novartis sales representatives should be paid overtime.

The court found that the content of the sales pitches was controlled by Novartis and Novartis sales reps were not allowed to alter those pitches in any way, meaning they had no discretion over the tone or content of the sales pitches. This led the court to conclude that Novartis sales representatives do not fall under the guidelines of administrative exemption because they did not have any authority over Novartis management policies or practices.

Furthermore, Novartis sales reps did not fall under the "outside salesmen" exemption because their primary duty was not making sales or obtaining orders. The Second Circuit Court of Appeals found that Novartis sales reps promote pharmaceuticals, but do not sell them. All the sales reps do is present information to physicians. It is up to the physician to prescribe the medication and then up to the patient to fill that prescription. That is, the drugs are not technically "sold" until the patient who has been prescribed a particular medicine has gone to have his prescription filled at a pharmacy or drug store.

In making its decision, the federal court followed information from the Department of Labor, which said that the pharmaceutical sales force was never exempt from overtime pay because the representatives do not make sales or obtain orders, nor do they exercise discretion and independent judgment.

Novartis appealed the decision to the US Supreme Court, which has now refused to review the federal court's ruling in favor of the Novartis sales representatives. This means that Novartis could have to pay approximately $100 million to around 2,500 current and former pharmaceutical sales representatives. Novartis expressed disappointment in the Supreme Court's decision.

Novartis Sales Rep New York Overtime Legal Help

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Last updated on Apr-3-11