New York Court Discusses Outside Salemens’ Exemption of the FLSA

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New York businesses are required by both state and federal laws to pay their employees for any hours they work, which includes overtime wages for any hours worked over forty hours per week. If an employer fails to pay an employee wages owed, an employee can file a lawsuit to seek compensation. Proving you are entitled to overtime wages is a multi-step process, however, as not all employees who work in New York are entitled to wage and hour protections. This was illustrated in a recent case filed in the Southern District of New York, in which the court dismissed the plaintiffs’ claims because the employer was exempt from the requirement to pay the plaintiffs’ overtime wages, due to plaintiffs’ positions. If you work in New York and you believe your employer owes you wages for hours worked, you should speak with a trusted New York overtime rights attorney as soon as possible regarding your right to seek any compensation you may be owed.

Factual Background

Reportedly, the plaintiffs worked as agents for the defendant employer. The defendant was a subcontractor for a company that was retained by a wireless service provider to solicit customers for a government-subsidized program that provides mobile telephone services to low-income individuals. The plaintiffs stated that they had daily meetings in the morning and then spent the majority of each day soliciting wireless plan applications before returning to the office.

Plaintiffs claimed that the defendant violated the Fair Labor Standards Act (FLSA) and New York Labor laws by allegedly misclassifying the plaintiffs as independent contractors and failing to pay them overtime wages. The defendant filed a motion for summary judgment arguing they were not the plaintiffs’ employer and that the plaintiffs were outside salespeople and therefore, not entitled to wage and hour protections. The court granted the defendant’s motion for summary judgment, after which the plaintiffs appealed.

Outside Salesmen Exempt from Overtime Pay

Certain classes of employees are not entitled to the FLSA’s overtime protections because they fall under one of the FLSA’s exemptions. Outside salesmen are among those employees that are exempt from wage protection by the FLSA. This is due to the belief that they typically make much more than the minimum wage and receive other fringe benefits, which set them apart from nonexempt workers. To determine whether an FLSA exemption applies, the courts are required to read an exemption fairly.

On review, the court noted that outside salesmen include any employee whose main duty is to make sales or obtain contracts or orders for services, for which the client will be paid by the customer. Additionally, an outside salesman is typically engaged in business away from his or her employer’s office. Here, the plaintiffs did not dispute that they solicited customers away from the office but argued that they were not outside salesmen because the applications they solicited were not binding. The court was not persuaded by this argument, stating that the employee does not need to close the deal to be an outside salesman, because “sale” is broadly defined. Thus, the court affirmed the trial court ruling.

Consult a Trusted New York Overtime Rights Attorney

If you work in New York and your employer did not pay you overtime wages you believe you are owed you should meet with a trusted New York overtime rights attorney to discuss your case. At Jaffe Glenn Law Group, our overtime rights attorneys will aggressively pursue any overtime wages you may be owed. We can be reached at 201-687-9977 or through our online form to set up a confidential and free meeting.