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Verdict Against Retail Supplier Reached in Sales Agent Compensation Suit (Decision Means Agents Can Make Claims for Minimum Wage, Overtime)

October 10, 2014

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Copyright 2010-14 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

A jury has decided against Just Energy in a suit concerning compensation to certain sales agents

This case concerns minimum wage and overtime under the Fair Labor Standards Act and overtime under the Ohio Minimum Fair Wage Standards Act. Plaintiffs were door-to-door workers who solicited residential customers for Just Energy.

Just Energy argued that the plaintiffs were independent contractors and exempt outside salesman who cannot make a claim under the FLSA.

However, plaintiffs contended that because Just Energy subjected them to significant supervision, they were not exempt outside salesman. As described by a U.S. district court, "They say that Just Energy regional distributors and supervisors controlled the length of the Plaintiffs' work week and work day by assigning them to a work crew and van, sending the vans to solicit specific neighborhoods, and prohibiting the vans from returning to the office before 9 p.m. The Plaintiffs also say that Just Energy regional distributors required the Plaintiffs to knock on a specific number of doors and obtain a certain number of orders, required the Plaintiffs to report to the office every morning, prevented the Plaintiffs from working independently, controlled the Plaintiffs' break time, and required the Plaintiffs to purchase and wear Just Energy branded clothing."

In denying a motion from Just Energy for summary judgment in its favor, the Court distinguished Just Energy's agents from various precedent. Describing various actions taken to prevent slamming, the court noted that, "Just Energy prevented the Plaintiffs from completing a sale by retaining unlimited discretion to accept and reject the orders obtained by the Plaintiffs."

"The contracts the Plaintiffs bring to Just Energy are merely proposals until Just Energy accepts them," the Court said. "Therefore, because Just Energy retains an unlimited right of rejection, the Plaintiffs are more like the [non-exempt] student salesman in Wirtz and the military recruiters in Serco whose employers retained discretion to accept and reject their orders."

The Court also said that the Plaintiffs' evidence shows that Just Energy routinely hired workers with no prior sales experience, which is not indicative of outside sales.

A subsequent jury trial found in favor of the plaintiffs' class and collective action that certain individuals were not properly classified as outside sales people in order to qualify for an exemption under the minimum wage and overtime requirements pursuant to the Fair Labor Standards Act and Ohio wage and hour laws.

Potential amounts owed have yet to be determined and will be subject to a separate proceeding.

Just Energy disagrees with the result. "Just Energy strongly believes it complied with the law, is investigating all legal options and plans on appealing the verdict," it said in a news release.

Also notable is that according to evidence in the case, during the plaintiffs' employment, the commission schedule that Just Energy allegedly paid the plaintiffs was approximately $35 for every order that they obtained.

Case No. 1:12-CV-00758

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