Electronic order transmissions don't defeat the outside-salesperson overtime exemption

12/16/02 - Minimum Wage Opinion Letter - Applicability of M.G.L. c. 151, s. 1A(4) and (8)

December 16, 2002

Your letter to the Office of the Attorney General has been forwarded to me for response. The Division of
Occupational Safety, an agency under the state Department of Labor and Workforce Development, is
responsible for responding to inquiries concerning the applicability of the Massachusetts Minimum Fair Wage
Law, M.G.L. 151, and regulations promulgated thereunder. You have asked for a written opinion regarding the
applicability of the state overtime law, M.G.L. c. 151, s. 1A, to one of your client companies. [1] Specifically,
you have asked several questions about the overtime exemptions for outside salespersons (M.G.L. c. 151, s.
1A(4)), and drivers and helpers on trucks (M.G.L. c. 151, s. 1A(8)). As your questions concern separate
overtime exemptions, I will address each in turn.

Outside Sales Exemption

The Massachusetts overtime law, M.G.L. c. 151, s. 1A, applies to employees in an "occupation" as defined by
M.G.L. c. 151, s. 2. Section 2 defines "occupation," in pertinent part, to exclude "outside sales work regularly
performed by outside salesmen who regularly sell a product or products away from their employer's place of
business and who do not make daily reports or visits to the office or plant of their employer." Outside
salespersons are also specifically included in the enumerated exemptions from the state overtime law. M.G.L. c.
151, s. 1A(4).

As I understand it, your client employs outside salespersons to sell company products to grocery stores,
convenience stores, and other similar retail establishments. Your clients' outside salespersons use hand-held
computers to record orders that are transmitted electronically on a daily basis to the company's warehouse. You
have asked for confirmation that the daily transmission of order information does not constitute a "daily report"
for purposes of the overtime exemption. Your client's outside salespersons also attend a one to two-hour weekly
sales meeting at a company warehouse. You have also asked for confirmation that this weekly meeting would
not affect these employees' classification as outside salespersons.

The term "daily report" is not defined in the statute, and this Office is unaware of any court opinion that might
provide guidance as to its meaning. In the absence of such guidance, it is left to this Office to give the language
a reasonable interpretation. This Office will interpret "daily report" to mean reporting to the office or plant in
person. [2] Therefore, daily electronic transmissions of sales orders do not constitute "daily reports" within the
meaning of the statute.

As to the weekly sales meetings, this Office would consider such meetings incidental to and in conjunction with
an employee's outside sales, as they would likely be treated under analogous federal law. See 29 C.F.R. s.
541.503. Therefore, attendance at such meetings would not affect the otherwise proper classification of an
employee as an "outside salesman."

Delivery Drivers

Your client also employs delivery drivers to transport products to the various retail establishments. Section
1A(8) of M.G.L. c. 151, provides, in pertinent part, that an employer need not pay overtime to "a driver or
helper on a truck with respect to whom the Interstate Commerce Commission has power to establish
qualifications and maximum hours of service pursuant to the provisions of section two hundred and four of the
motor carrier act of nineteen hundred and thirty-five." With respect to drivers or helpers on trucks, this
exemption closely tracks an exemption found in federal minimum wage and overtime law, the Fair Labor
Standards Act. Under federal law, it is "not material whether such qualifications and maximum hours of service
have actually been established by the Secretary of Transportation; the controlling consideration is whether the

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employee comes within his power to do so." [3] 29 C.F.R. s. 782.1. You have asked for confirmation that the
Massachusetts overtime exemption would be interpreted in the same manner. Given the express language of the
statute, the state exemption would similarly apply to drivers and helpers on trucks with respect to whom the
Secretary of Transportation has the power to establish qualifications and maximum hours of service, regardless
of whether or not that power has been exercised.

I hope this information has been helpful. Please note that this opinion is based solely on the information
provided with your request. The existence of other facts not contained in your request might require a different
conclusion. If you have any further questions, please feel free to contact me.

Sincerely,
Lisa C. Price
Legal Counsel

[1]
As I know you are aware, employers are also subject to the federal minimum wage and overtime laws, found
in the Fair Labor Standards Act (FLSA) and regulations promulgated thereunder. For information about
applicable federal wage and hour laws, you should contact the U.S. Department of Labor.
[2]
It should be noted that this language pertaining to daily reporting appeared in the statute long before such
electronic transmission was technologically feasible.
[3]
The relevant functions, powers, and duties of the Interstate Commerce Commission were transferred to the
Secretary of Transportation in 1966.

= Names have been Omitted