Book a demo

Over the past several days, we’ve discussed certain contract positions that can be exempt from the overtime regulations of the Fair Labor Standards Act (FLSA), which requires most employees to be paid at a rate of 1.5 times the regular rate when they work more than 40 hours in a week. There is one more exemption to discuss, and that is the one for Outside Sales Employees.

If you are placing a contract employee who will be working in outside sales, they may be exempt from overtime if they meet two basic criteria. First, their primary (i.e., principal, main, major, or most important) duty has to be making sales or obtaining orders. Secondly, they must “customarily and regularly” be conducting business outside the client’s location. The Department of Labor (DOL) defines “customarily and regularly” as “greater than occasional but less than constant.” The (DOL)’s Fact Sheet for the Outside Sales Employee contains more details, including what constitutes ”making sales.”

Unlike the other exemptions we’ve discussed for Professional, Computer-Related, Executive, and Administrative positions, contractors qualifying for the Outside Sales Employee Exemption do not have to be paid on a salary basis at a rate of $455 per week.

For additional questions on the Outside Sales Employee Exemption, be sure to refer to the DOL’s Fact Sheet and consult an employment attorney when in doubt.

This article is for informational purposes only and should not be considered legal advice.

You may also be interested in…

Article

Independent Contractor Compliance: DOL vs IRS

In the realm of labor and taxation, the classification of workers as...

Case study

New Zealand Based Company Expands to USA with FoxHire

How can an international company expand to America and hire new employees?...

Webinar

Why Contract Staffing Should Be in Your Playbook

Are you a direct hire recruiter looking to grow your business? Contract...

A complete Employer of Record (EOR) platform for onboarding, payroll, and compliance – so you can hire without the hassle.