Earlier this week, GlaxoSmithKline PLC (Glaxo), formerly known as SmithKline Beecham Corporation, filed its brief in the U.S. Supreme Court in Christopher v. SmithKline Beecham Corporation, one of the only Supreme Court cases to address the overtime exemptions under the Fair Labor Standards Act (FLSA), and the first to address the criteria for the outside sales exemption. At issue is whether pharmaceutical sales representatives (PSRs) qualify for the outside sales exemption because pharmaceuticals are generally purchased by end-users at pharmacies, which purchase from wholesale distributors. The Court’s decision may have far reaching implications, not only for the pharmaceutical industry, but also for other industries that depend on representatives to call on customers at their place of business to generate sales, although the actual sales orders are placed by customers through a centralized order and distribution center or similar process. The case is also significant because it may determine the extent to which courts are required to defer to U.S. Department of Labor’s (DOL) changing interpretations of federal employment statutes and regulations.
Petitioners’ Position
Petitioners Michael Shane Christopher and Frank Buchanan (Petitioners), former SmithKline PSRs, are seeking to reverse the Ninth Circuit Court of Appeals’ decision1 holding that: (1) Glaxo’s PSRs were properly classified as exempt under the “outside sales” exemption, and (2) the court was not required to defer to the DOL’s amicus brief, on behalf of petitioners, interpreting the exemption.
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