My Current State: 

Nebraska Exempt Employees


Posted by Tamara

The U.S. Department of Labor handles about 10% of the wage and hour enforcement in this country. That may not seem to have much of an impact, but many states utilize the federal regulations as the blueprint for their own guidelines regarding exempt salaried employees.

That is why it’s of utmost importance that Nebraska employers and employees pay attention to the Department of Labor opinions.

Recently, the DOL has taken a more stringent approach when interpreting the regulations regarding exempt salaried employees. In addition, the department is taking action against employers that cross the line. Of particular interest is the exempt status of salaried outside salespeople and of administrators.

According to a recent opinion issued by the DOL, pharmaceutical reps do not qualify under FLSA (Fair Labor Standards Act) as salaried exempt outside salespeople. The opinion arose during litigation with Novartis Pharmaceutical Corp. The opinion stated that the reps do not qualify because they are not legally allowed to sell or to take orders for the medications they represent. These employees do act with little to no supervision, but they follow company policy in almost every aspect of their job.

An argument could be made that since the reps create their own schedules and make their own appointments, they would qualify as exempt administrators. According to DOL, however, that assumption is incorrect. To qualify as exempt, administrators must be capable of exercising independent judgment in significant matters of operation. Pharmaceutical reps do not have that capability.

This ruling of the DOL will have far reaching effects on U.S. employers, particularly the drug companies. It is also possible that the regulations may be interpreted even more strictly in the future. According to Washington, D.C attorney, Gregory Jacob of Winston & Strawn, the recent DOL ruling makes it increasingly difficult for any employee to be classified as an exempt administrator.

 

 

 

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