The Inside Scoop On Inside Sales

Commissioned sales is one of the few areas in which California law is arguably more favorable to employers than the FLSA or laws of other states.  Specifically, California law recognizes an exemption from overtime for sales employees in many industries, provided they are primarily engaged in sales, earn at least one and one half times the minimum wage, and more than half of their income comes from commission earnings. 

Dubbed the “inside sales exemption,” this often-overlooked exception to the obligation to pay overtime applies to sales employees who do not qualify for the outside sales exemption because they work at their employer’s place of business.  In an opinion interpreting the applicability of the exemption broadly, the court of appeal in Muldrow v. Surrex Solutions Corporation confirmed the applicability of the exemption to employment recruiters. 

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