Seyfarth Shaw LLP | www.seyfarth.com Litigating CA Wage & Hour Class and PAGA Actions (23rd Edition) 15 The job duties were easily divided into “sales” and “delivery,” and Ramirez merely held that more time had to be devoted to sales than to delivery for the delivery salespersons to qualify as outside salespersons.69 Ramirez left open the following questions: • What does it mean to “customarily and regularly“ spend more than one-half of the work time on outside sales? “Customarily and regularly“ is defined in the FLSA regulations as “more than occasionally but less than constantly.”70 If an employee has a habit of often spending two or three days working away from the employer’s place of business, but spends the overall majority of all work time at the employer’s place of business, would that qualify as “customarily and regularly” spending more than one-half the work time outside? • How does one attribute time spent before a sale preparing to make a sales call or time spent after a sale completing the paperwork? Ramirez mentioned that the employer argued it would be absurd to exclude those tasks from the “outside sales” calculation, but Ramirez did not explain how those duties should be analyzed under the exemption. • What constitutes “away from the employer’s place of business”? Clearly delivering water to a customer’s home qualifies, but what if the employee is in a job where he is making customer contact by telephone? Is any time selling outside the employee’s designated “office” considered time “away from the employer’s place of business”?71 • How does an employer enforce reasonable expectations that its employees spend the majority of their time outside selling? Where the employer encourages selling, but allows the employees to make sales any way they want without tracking their movements, what is the employer’s reasonable expectation as to “outside sales” activity? Because all these questions remain open, there continues to be a great deal of litigation over the outside sales exemption. Separate from the substantive issue of whether a particular employee meets the outside sales exemption, there has been significant litigation over whether outside sales exempt status can be decided collectively on a class basis. Courts have been more willing to deny class certification in these cases where the only question is whether employees who undisputedly focus on sales spend enough of their time “outside” to meet the exemption. 69 Id. at 801. 70 See Baca v. United States, 29 Fed. Cl. 35 (U.S. Fed. Cl. 1993) (doing exempt duties only one-third of the total work time, but on a regular recurring basis, qualified as performing the task “customarily and regularly“); Shriner v. Smurfit-Stone Container, 2006 Mont. Dist. LEXIS 606 (D. Mont. Aug. 30, 2006) (employee who spent less than half of his total work time supervising employees still “customarily and regularly” supervised employees because “his role as a relief supervisor was expected, relied upon and regularly performed” and was his role “on more than isolated or occasional incidents”). 71 In Espinoza v. Warehouse Demo Servs., Inc., 86 Cal. App. 5th 1184 (2022), the Court of Appeal provided some context as to what constitutes “away from the employer’s place of business.” There, the court considered employees who offered samples of products at third-party retail stores. Although the employer did not own the stores at which the employees worked, the court held that they did not work “away from the employer’s place of business” because the employees worked exclusively at the store, all of the employer’s managers worked at the store, the employer placed the employees at the store, the employer maintained offices in the store, and the employer kept equipment at the store. Id. at 1192.
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