Healthy Skepticism Library item: 7157

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: news

Selvin M.
Drug firm reps sue for overtime
The LA Times 2006 Dec 1
http://www.latimes.com/business/la-fi-overtime1dec01,1,3436668.story?coll=la-headlines-business&ctrack=1&cset=true

Abstract:

Drug company agents, who say they routinely work 60-hour weeks visiting doctors’ offices, said Thursday that they had sued Pfizer Inc., Johnson & Johnson and six other drug companies for failing to pay overtime.

The lawsuits, which could involve tens of thousands of U.S. employees, add the pharmaceutical industry to other sectors that have been accused of giving rank-and-file workers managerial-like job titles to avoid paying overtime.

The suits follow Pfizer’s announcement Tuesday that it will lay off a fifth of its U.S. sales staff, underscoring concern about an industrywide retrenchment as drug firms face pressure to cut costs.

The suits are similar to dozens of claims filed in recent years against major retailers, insurers and other employers. Lawyers for the plaintiffs are also readying a second group of suits against big drug makers, alleging they have discriminated against older representatives.

The claims by pharmaceutical agents were made in complaints filed in recent weeks in state and federal courts in New York, New Jersey and California. The cases have all been moved to federal courts.

The suits contend the companies improperly designated the agents exempt from laws requiring overtime for employees who work more than 40 hours a week. Under federal law, only employees in certain occupational categories – including managers, professionals and outside sales representatives – aren’t entitled to overtime.

The plaintiffs contend that the drug agents don’t qualify as sales representatives because the doctors they visit aren’t actually buying anything from them, said Charles Joseph, an attorney for the workers. Instead, he said, the agents are basically “marketing or promotional people. A large part of their job is to drive and drop off samples at the doctor’s office.”

The complaints seek back pay and damages for current and former employees.

Drug company executives denied the contentions. “We’re obviously aware of the lawsuits,” said Pfizer spokesman Bryant Haskins. “We don’t believe they have any merit and we will vigorously defend that position.”

The other drug companies are AstraZeneca, Amgen Inc., Eli Lilly & Co., Hoffman-Laroche Inc., GlaxoSmithKline and Bayer.

The lawsuits are the latest in a wave of litigation accusing companies of violating state and federal pay laws. On Nov. 22, IBM Corp. agreed to pay $65 million to settle claims that it illegally denied overtime pay to 32,000 workers who install and maintain computers. Other recent multimillion-dollar settlements have centered on overtime claims brought by stockbrokers, insurance claims adjusters and retail store managers.

“This is still a growth business,” said Ken Sulzer, a Los Angeles attorney who has defended employers in many such cases.

The drug company lawsuits come as the industry grapples with market shifts that may marginalize the familiar platoons of sample-toting agents, said Robert Goldberg, vice president at the Center for Medicine in the Public Interest.

“It’s going to be less point-of-service sales and more through e-mail and videoconferences and podcasts” as well as through partnerships with managed-care plans, he said.