Category Archives: Department of Labor

Chiming In on the Supreme Court’s Overtime Decision

There’s some pretty prolific fallout out there around the Supreme Court’s decision Monday to strike down two SmithKline Beecham Corp. pharmaceutical sales representatives’ claim that they should have gotten overtime because they worked more than 40 hours a week.

Just as impressive as the decision is for those directly involved is the fact that it also strikes down an Obama Adminsitration interpretation of labor law.

Here’s part of the Wall Street Journal ‘s recap (subscription required) that sums it up pretty succinctly.

In the Christopher v. SmithKline Beecham Corrp. decision, a 5-4 majority clarified that white-collar sales reps for drug companies don’t qualify for overtime. Two employees for SmithKline Beecham made such a claim, and the Obama Labor Department jumped in with an amicus brief in this and similar cases. A favorable ruling would have freed the plaintiffs bar to bring class actions on behalf of 90,000 drug reps for billions in back pay.

The High Court ruled that the claim wasn’t required under the 1938 Fair Labor Standards Act, which was enacted to protect workers from “substandard wages and oppressive working hours” and explicitly exempted “outside salesmen.” The plaintiffs argued they aren’t in sales because they merely “promote” drugs to physicians. But the Court noted that federal laws bar drug companies from selling certain products directly to consumers; they must be prescribed by physicians.

The WSJ also pulled no punches in commending the majority “Supremes” for holding tough in their ruling. “The Supreme Court doesn’t get overtime pay, but maybe it ought to for striking down a novel Obama Administration interpretation of labor law on Monday,” the piece “An Overtime Victory,” starts out. It goes on to say that the majority was “not not amused by the Labor Department’s attempt at regulation-by-amicus brief.” It continues:

 Justice Alito wrote that Labor had not once—in 70 years of the drug-rep pay system—filed an enforcement action of this kind. Instead of going through a formal rule-making, the agency joined lawyers to force what Justice Alito called an “unfair surprise” on the industry.

The lawsuit was part of the Administration’s campaign to bring more workers under wage-and-hour laws, the better to unionize and provide trial-bar jackpots. Courts have mostly taken a dim view of these legal runarounds, and the Supremes deserve credit for upholding long-settled labor law.

The arguments on both sides focused on whether sales were actually made or not. The Department of Labor, Obama administration and dissenting judges held to the notion that the Fair Labor Standards Act’s “outside sales exemption” did not apply to the representatives because no actual sales transaction took place.

It’s complicated, and the fallout — legally and through discourse — is only beginning. In this post on the Wage & Hour Litigation Blog, attorneys Richard Alfred, Alex Passantino and Jessica Schauer write about its impact:

Obviously, the impact of the Court’s decision will be felt most immediately in the pharmaceutical industry.  Dozens of pending cases around the country will likely be dismissed based on this decision.  Dozens more nascent lawsuits likely will never be filed, and the tens of thousands of employees who are currently working as [pharmaceutical sales representatives] will continue to be treated as exempt, at least under federal law and in states that follow the FLSA’s outside sales exemption.

But the Court’s decision in the Christopher case potentially permits employers in all industries to classify a wider variety of employees as outside sales, even if the employee does not directly effect a transfer of title.  Moreover, due to the Court’s decision on deference [striking down the Obama brief’s argument that the DOL’s interpretation of its regulation should be given Auer deference], the Christopher case is likely to reverberate throughout many other industries.

Fighting Unemployment Discrimination via Facebook

Facebook has become a social-recruiting player yet again, this time in the form of one software provider’s campaign to end discrimination against the unemployed, as this story details.

The provider, Smart Recruiters, calls it the “Unemployed, Please Apply” campaign, accessible through its Unemployment Movement Facebook page. The title is a take on “Unemployed Need Not Apply,” a message that has been explicitly stated in job advertisements and is now under investigation by the U.S. Department of Labor, the Equal Employment Opportunity Commission and the National Employment Law Project.

The campaign is asking that businesses visit the page and pledge their commitment to interview at least one unemployed candidate for every job opening. SmartRecruiters, a free-recruiting-software provider headquartered in San Francisco, says this problem is very real. According to a recent survey it conducted, 82 percent of recruiters, hiring managers and human resource professionals confirm that “discrimination against the unemployed is a reality.”

The survey also reveals 55 percent who say they have “personally experienced resistance when presenting a qualified, yet unemployed, candidate” and 53 percent who see unemployed job seekers as “unemployed for a reason” or “probably not qualified.”

Further proof of this discrimination can be found in this July 19 Leader Board blog post by Andrew McIlvaine, based on an analysis of job ads by NELP.  

“There is an unwritten rule that unemployed candidates just aren’t qualified,” says SmartRecruiters CEO Jerome Ternynck. “Not only is this bad business; it’s also unfair and needs to stop … .”

Last month, I blogged about Facebook’s announcement of a joint project with the U.S. Department of Labor called the “Social Jobs Partnership,” a Facebook page where job seekers could find a plethora of job openings and information from a host of organizations committed to putting America back to work.

“I am very disturbed when I hear that employers don’t want to even look at resumes of people who have been out of work for six minths or just [are] unemployed,” DOL Secretary Hilda Solis said at the partnership’s announcement. “It’s as though people have created this problem themselves, and that’s just not true.”

What do you think? You think you might take this new pledge plunge?

Facebook, DOL Take New Joint Step in Social Recruiting

Facebook announced just yesterday a new partnership with the Obama administration and its U.S. Department of Labor aimed at connecting America’s job seekers with some 3 million jobs that are currently unfilled.

The “Social Jobs Partnership” is a newly launched Facebook page aimed at connecting seekers with employers, according to this report from CNSNews.com

Secretary of Labor Hilda L. Solis announced it at the department’s Washington headquarters, saying “our all-star social-media team [is] committed to putting America back to work.”

“Beginning today,” she said, “132 million Facebook users can discover new tools to find out about these job openings and the skills that they will need to get hired. … By leveraging the power of the social web, this initiative will provide immediate, meaningful and ready-to-use information for job seekers and employers, and a modern platform to better connect them.” (Here is DOL’s release about the initiative.)

At first glance, it’s hard to tell just how Facebook will facilitate these connections other than simply listing a host of employment-related links on the page, such as the National Association of Colleges and Employers, DirectEmployers, the National Association of State Workforce Agencies, Career One Stop, Job Corps and, of course, DOL.

It’s also hard to determine whether connections with private employers will be just as readily available — and promoted — as public employers. But it definitely includes site links to both sectors and does seem to offer a one-stop shop for information, training programs, educational opportunities, employment-related organizations, job-search resources, and some coaching and counseling help.

Marne Levine, Facebook’s vice president of global public policy, said at the announcement that “Facebook is about connecting people, so that they can share what’s important to them, and that is the driving force behind the [partnership].” She said the new page would fill the “connection gap in America’s workforce.” That’d be nice, if that turns out to be the case.

The page’s general information section does list initiatives “to more effectively leverage the utility of social networks in the job market,” such as conducting surveys, allowing employers to post job openings for free and promoting federal job openings.

Earlier this month, Senior Editor Andrew McIlvaine posted on this blog his report from the HR Technology® Conference’s closing keynote speech by Jim Holincheck, Gartner’s managing vice president for finance, HCM and procurement. Entitled “Welcome to Face-Linked,” it kind of took us into Holincheck’s fantasy of a future where all the major social networks have coalesced into one  global platform that would include — in addition to worldwide social connections unburdened by privacy and language restrictions — a worldwide talent-management solution the likes of which we can only imagine.

Am I intimating that this new partnerhsip heads us in that direction? Hardly. So much more would have to be added to something like the Social Jobs Partnership page to turn it into even a suggestion of Holincheck’s global Face-Linked vision. But if his vision really is where social media is heading, then I’d have to guess, for a site as big as Facebook to join hands with the U.S. government to help its citizens find work … well, that could be seen as a first baby step, no?