Supreme Court contorts itself to deny overtime protection to 90,000 pharmaceutical employees

In a 5-4 decision issued this week in Christopher v. SmithKline Beecham Corp., the Supreme Court, in its eagerness to reach a result favoring the pharmaceutical industry over its employees, abandoned the legal straight and narrow for some very sketchy shortcuts. The case concerned the application of overtime protection to medical detailers, also known as pharmaceutical representatives, employees who visit physicians and promote prescription drugs. If the detailers are “outside salesmen,” they are exempt employees and are not entitled to overtime pay.

Ignoring the plain meaning of key words, the “ordinary usage” which Justice Antonin Scalia elsewhere has claimed to favor, the court declared medical detailers to be outside salesmen because—even though they never make a sale of pharmaceuticals to anyone—they come as close to selling as the law governing their industry allows. The best the court could do in terms of identifying sales that these supposed salesmen make is to find that the detailers induce “non-binding commitments” from physicians to prescribe the drugs their pharmaceutical companies are promoting or marketing. The court found that the fact the detailers almost get commitments from these physician “gatekeepers”—without whom no one could sell the prescription drugs being promoted—is enough to treat the “transaction” as a sale. Whew, talk about bootstrapping and judicial activism! A justice could get a hernia with that kind of lifting!

But who in reality buys prescription drugs? Certainly, in any normal economic sense, it’s not the prescribing physician. There are, in fact, two parties that purchase them, and the detailers don’t sell (or even make binding commitments) to either: the retail drug stores like CVS and Walgreens, and the patients who are the end users. The court deals with sales to the drug stores in a most unsatisfactory way: It says that the people who actually make those sales are so few (2000 sales agents vs. 90,000 detailers), and their function is so rote, that we should ignore them.

The persons who make sales (exchanging money for a product) to patients are pharmacists, but the court argues that there would be no sales without the prescribing physicians, who deal with the medical detailers and have a completed transaction when they make a non-binding commitment—not to buy—but only to prescribe the drugs for appropriate patients. According to the court, this is” tantamount” to a sale.

An unfortunate lesson this case teaches is that no one knows what the law means until the Supreme Court decides the result it wants and then stretches the meaning of the statutory or regulatory language to (more or less) fit the result.

The other lesson from this decision is for the Labor Department, which had never in 60 years brought an enforcement action against a pharmaceutical company in a way that gave the industry notice that its widespread practice of denying overtime pay to detailers was unlawful. The medical detailers are relatively well paid and loosely supervised employees whose employers do not closely monitor their work time—not the classic employees we think of when we talk about overtime pay. Although there is no excuse for the tortured logic of the majority opinion, if the Labor Department had given fair notice that it disapproved the exemption of detailers, either by bringing enforcement actions over the years or even issuing consistent guidance that made its interpretation of the statute and its regulations clear, the court might have found that the exemption did not apply.

In other words, if we don’t enforce our rights, we can lose them.

  • Mohammed Kader Kadery

    Secrecy is the father
    of democracy and mother of Conspiracy’ The nice tools are election based
    democracy and interest based economy and judiciary to justify unjust
    exploitation through elected officials, lobbyist legal technicians, [a] Legal
    Professionals [b] systems in operation.

    Truth is to set us free
    said in Bible. Truth is Trust; lie is betrayal, if there is any accountability,
    and transferences. This needs honesty first to last. Under the cover of the
    system in operation Honesty is far way off. Only we can visualize its Presence
    through “Unfit person are in the authority” everywhere.

    Is there any to take

    Bible stands firm in
    saying “If the foundation of a building damazed there is no way to save it, if
    any other part is damage d it can be, but Foundation destroyed we need to start
    a new.”

    This is more realistic
    to day than ever, here there and every where. Is not it true?

    If you need help be
    sure help is near and closer. I have a quote from Scripture Revelation Book 3
    Verse 17: “You think that you are rich, you do not realize that you need any
    help. You do not realize that you are [1] Wretched [2] Poor [3] Pitiful [4]
    Blind [5] Naked.

    Is not this verse a
    perfect resemblance of the over all Global situation in General and Great
    Nation America
    in Particular?

    Mohammed Kader Kadery

    Democratic School of Economics and Administration

    New York, USA.




  • Jason Doege

    There are a couple of ways to evaluate what a role is. In this article you state that a salesman is one who actually exchanges goods/services for money. However, in my experience, that is more in line with describing a clerk. The professional sales-people I work with primarily work to:

    1) identify potential customers
    2) qualify potential customers
    3) secure customer interest
    4) close customer objections
    5) obtain customer commitment

    I think what the Supreme Court was identifying was that the actual activities of detailers aligned pretty closely with the activities of professional sales-people despite differences of details in process. In other words, the skills, training and activities of detailers were predominantly the same as for professional sales-people and therefore the class of that job should be considered similarly.

    So, not the act of contortion you are suggesting, I think.