Outside Sales Exempt

bamahr · September 2005

We pay our Outside Sales Staff a weekly draw and a monthly commission. When the monthly commissions are calculated - we take the weekly draw for the month off the earned commission. This being said we have some sales people that would rather have a smaller weekly check and the larger monthly commission. Under the DOL change to Exempt - do we have to pay them the $455 weekly or can I pay them less - due to the commission?

lorrie · September 2005

We pay our outside sales team twice per month: a mid-month draw, and then balance of commissions at month's end. A few of them have requested no mid-month draw, only their month-end commissions, and our payroll dept. does not mind doing this for them.

The M. Lee Smith 'HR Executive Special Report' on 'Overtime Ins and Outs: How to Comply with the FLSA,' page 19, says "There is no minimum salary requirement for outside sales employees." So, assuming your outside sales force meets the qualifications for this exemption, the answer to your question is NO, you don't have to pay them the $455 weekly.

TN HR · September 2005

I concur with Lorie. The FLSA specifically exempts commissioned sales from its provisions.

Kathy in Alabama · September 2005

We have several employees in the same category. I called DOL, they referred me to the Alabama DOL office. I described our payment plan to outside sales staff (very similar to yours), and they confirmed that outside sales are exempt from this reg in every way. We can structure their draw / commission how ever we want to and that the employee will agree to work for. We have a sales employment contract so that the details are worked out prior to their employment.

bamahr · September 2005

THANKS!

Outside Sales Exempt

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