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D.Md.: For Application of Outside Sales Exemption, Any Fixed Site Used By Employee To Solicit Sales Is Considered Employer’s Place of Business

Speert v. Proficio Mortgage Ventures, LLC

This case was before the court on the plaintiffs’ motion for partial summary judgment.  The case concerned a group of mortgage loan originators who claimed they were wrongly denied minimum wages and overtime compensation by defendants.  As discussed here, plaintiffs, who were loan originators employed by defendants, moved for a finding that the “outside sales exemption” was inapplicable to them.  It appears undisputed that the plaintiffs worked in a satellite or branch office, rather than defendants’ main office or headquarters.  Despite this fact, the court awarded plaintiffs summary judgment on this issue.

Citing the relevant CFR regs, the court explained:

“The only point otherwise argued by Defendants is that Plaintiffs concede they never performed any work at Proficio’s licensed Owings Mills, Maryland, office and, therefore, Plaintiffs have conceded they were “customarily and regularly engaged away from their employer’s place of business,” within the meaning of the “outside sales” exemption of 29 C.F.R. § 541.500. (Defs.’ Opp. 10.) Defendants’ interpretation of the exemption is contrary to the explanatory language of 29 C.F.R. § 541.502, which states, “[A]ny fixed site, whether home or office, used by a salesperson as a headquarters or for telephonic solicitation of sales is considered one of the employer’s places of business, even though the employer is not in any formal sense the owner or tenant of the property.” Given that language, it matters not whether Plaintiffs worked in Proficio’s “licensed” location or in another location. Defendants have not sustained their burden of proving by clear and convincing evidence the applicability of the “outside sales” exemption to Plaintiffs. In fact, no genuine dispute of material fact exists on the applicability of this exemption. It does not apply to the Plaintiffs.”

Although the law is fairly clear in this area, this case serves as a reminder that employees need not be working out of the employer’s headquarter’s or “home” office, in order to be considered working from an inside sales location within the meaning of the FLSA.

Click Speert v. Proficio Mortgage Ventures, LLC to read the entire Memorandum Opinion.