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March 1, 2003
It appears the Sales Incentive Compensation Act (H.R. 2070) has been on sojourn since the bill was passed by house subcommittee early last summer. The

It appears the “Sales Incentive Compensation Act” (H.R. 2070) has been on sojourn since the bill was passed by house subcommittee early last summer.

The amendment to the Fair Labor Standards Act of 1938 would allow inside sales employees to be exempt from the 40-hour workweek if they meet certain requirements regarding job duties and compensation. An employee would have to have a detailed understanding of the customer's needs and specialized or technical knowledge of the products or services being sold. The sales would have to be made predominately to repeat customers; in other words, telemarketers or “cold callers” would not qualify for this exemption.

The bill also provides a number of protections for the employee in that it guarantees that the employee will receive a minimum amount of base pay, and an additional amount of commissions. The employee will also continue to receive pay based on commissions from additional sales. So, employees who choose to work longer hours in order to make more sales are guaranteed compensation in the form of commissions.

The bill was introduced by Reps. Patrick Tiberi, R - Ohio, and Rob Andrews, D - N.J., and the Subcommittee on Workforce Protections, chaired by Rep. Charlie Norwood, R - Ga., passed the bill by a vote of 8-6 on June 27.

“H.R. 2070 would help salespeople to perform their jobs more effectively by allowing them to schedule their work hours in such a way as to maximize their sales and increase their earnings. If we do not change the law, then we are, in effect, denying workers the opportunity to maximize their sales and income,” Norwood said. “As this legislation is considered by the full committee, I urge my colleagues to support it.”

Certainly, the bill would affect electrical distributors and inside sales staff. Readers are encouraged to voice their views regarding the bill to their representatives. For more information about the bill, visit

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