[tptacek]

(i) Sales staff are usually salaried exempt. I would be interested in a specific counterexample (ie, "inside sales at Airbnb is non-exempt!").

(ii) As a result, OT compensation for sales staff is usually zero.

(iii) This filing claims Groupon paid OT comp in the past. That was probably dumb. They don't have to.

(iv) By doing that, they created a basis for sales staff to argue that they were in fact non-exempt. But see (i): the expectation among sales professionals is that they are exempt.

(v) The other specific complaint in this filing is that Groupon didn't include commissions (variable comp) in the calculation for time-and-a-half overtime. In other words, they paid time-and-a-half overtime, which (see (iii)) they didn't need to do, but didn't do it to someone's satisfaction.

How legit does this case seem to you? It looks like a gotcha case over FLSA status. You think the whole sales team signed on for that?

I'm not saying they're going to lose (it'll probably settle out). But does the core issue in here really seem legit to you? It doesn't to me.

[DanLivesHere]

FLSA also isn't a "class action" statute -- it's "collective action." The distinction is that you have to opt-in to be a plaintiff under the FLSA, while most class actions are opt-out.

[tedunangst]

(i) For CA, see http://www.management-advantage.com/products/overtime-exempt... which is probably clearer than reading the actual laws. Key requirement: "Usually work away from the employer's place of business".

[tptacek]

I don't know about the specific statutes in California, but from experience I'm pretty sure most tech inside sales reps are salaried.

[tedunangst]

Probably because most employees don't know their rights, nor would they be particularly interested in flexing them if they did. Not long ago you might have said that most long term contractors get invited to the company picnic. Not anymore.

[tptacek]

I really don't think this is as cut-and-dry as you seem think it is. There's a downside to being non-exempt. And companies can easily avoid paying overtime.

[rprasad]

The key phrase, of course, is that sales people are "usually" but not always exempt employees.

Actions speak louder than words, and treating a purported-exempt employee as a non-exempt employee (i.e., compensating them based on hours worked, or docking pay for not working specific hours) is pretty much all you need to do (as an employer) for the employee to be classified as non-exempt. The laws, and especially the NLRB administrative decisions, favor the employees in this regard.

The "expectations" bit doesn't matter in this case, because the specific actions of Groupon make those industry-standard expectations irrelevant. It's about what Groupon did, not what everyone else does.

Once Groupon began treating the sales staff as non-exempt employees, they became non-exempt employees, and Groupon became obligated to compensate them for time-and-a-half overtime.

Based on the facts currently available in the linked article and other sources online, I am saying that Groupon would lose if it gets to a hearing. But chances are better than 99% that they'll settle (or go bankrupt before the case gets anywhere in the court system).

[tptacek]

I don't really have an opinion about any of this. All I'm saying is, if you want to read tea leaves on how much this filing has set the whole Groupon sales force on fire, it's helpful to know that it's taking advantage of a technicality.