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Ohio Supreme Court To Consider Minimum Wage For Those Who Work On Commission

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Two commission-based sales reps are asking the Ohio Supreme Court to decide whether a constitutional amendment okayed by voters in 2006 required that they be paid minimum wage. The eventual ruling could have a big impact on businesses and employees throughout Ohio.

The lawsuit started with one of those free coupon magazines that come in the mail or in a plastic bag delivered to your doorstep. For this particular coupon book, JB Dollar Stretcher, most of the hundred or so employees of the company were outside sales representatives who were paid on commission.

The two who filed the lawsuit said they each worked about 50 hours a week selling ads, and they say the 2006 Ohio Fair Minimum Wage constitutional amendment entitled them to be paid minimum wage.

The owners’ attorney, John Susany, told the justices his clients were “astounded” they were sued because they had always displayed a poster from the Ohio Department of Commerce showing the minimum wage – before and after the amendment passed – and those jobs that are exempt from it. He says outside sales people have always been exempt. “It is no hyperbole when I said my clients were completely, completely surprised when this happened because they did what good employers should do,” Susany said.

But the lawyer for the sales reps, Andrew Biller, said the problem isn’t with the amendment that voters approved – it’s with the statute that state lawmakers wrote to put it into effect. Biller said that law conflicts with the Federal Labor Standards Act, because “the FLSA says employee means any individual employed by an employer.” And Biller said the law exempts certain employees, but the amendment’s intent was clear all along.

“The proponents of the amendment focused on raising the wages of low-wage workers, and that would be consistent with including previously-FSLA exempt workers, because those are also low-wage workers if they’re earning less than minimum wage,” Biller said.

Biller said that poster that Susany referenced is, in his words, an administrative agency’s obviously flawed interpretation of the law. And he says it’s been used to delay the full implementation of the minimum wage amendment for nine years.

“The court should reject that because that strips Ohio workers of the constitutional rights that they bargained for, and it punishes law-abiding employers by putting them at a competitive disadvantage to those employers who broke the law,” Biller said.

But Susany said his clients have done as the law told them to do, and he warned the justices that this lawsuit could put other Ohio businesses in a similar position—in his words, facing down the barrel of a class-action suit.

“They’re looking to create an avalanche of lawsuits and class-action lawsuits – lawyers, doctors, accountants, computer analysts – anybody who had that white collar exemption,” he said.

A trial court agreed with the owners, while the appeals court sided with the sales reps.  In the Supreme Court case, the sales reps were joined in support by the state’s largest trial lawyers’ group, the Ohio Association for Justice and the Ohio Employment Lawyers’ Association. And some big groups have filed paperwork to support the owners’ argument, including the Ohio Chamber of Commerce, the Ohio Council of Retail Merchants, and the Ohio chapter of the National Federation of Independent Business. It’ll likely be months before the court delivers a decision.