1st Circuit hands employers pivotal win in overtime case

In Modeski v. Summit Retail Solutions, Inc., a divided panel of the First Circuit has decided that a group of “brand representatives” who were employed by a marketing company to pitch particular products in client retail stores fell within the scope of 29 U.S.C. §213(a)(1). That provision exempts from the FLSA’s overtime and minimum wage requirements anyone employed “in the capacity of outside salesman.”

In deciding that the outside sales exemption applied to foreclose the plaintiffs’ class action for unpaid overtime, the Court majority rejected the argument that, at the time of their employment, the plaintiffs had NOT been engaged in “sales” within the meaning of the statute.  In other words, the Court found that the Plaintiffs were engaged in sales and thus not entitled to overtime.

The plaintiffs had argued that they had not been making sales because customers did not buy from them directly, but instead paid for the featured products at store cash registers along with other merchandise.

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