Place of business
Why the sale has to happen away from the employer’s place of business
The outside sales exemption discussed earlier in this chapter turns on more than the salesperson’s duties — it also turns on where the selling actually happens. An outside sales employee must be “customarily and regularly engaged” away from the employer’s place or places of business, meaning the sale itself needs to occur at the customer’s place of business or, when the employee sells door-to-door, at the customer’s home. The test asks where the sale itself is made — not where a fixed headquarters or solicitation site happens to be.
That location test cuts out more than it might first appear. Selling by mail, telephone, or the Internet does not count as outside sales unless that contact is merely an adjunct to the employee’s in-person calls — meaning it supports sales made in person rather than substituting for them. And any fixed site a salesperson uses as headquarters or for telephonic solicitation, whether a home or an office, counts as one of the employer’s places of business, even if the employer does not formally own or rent that space. An employee working a desk and phone all day, from a home office or anywhere else, is selling from the employer’s place of business no matter how the arrangement is labeled.
The rule also draws a few careful lines around travel. An outside sales employee does not lose the exemption by displaying samples in hotel sample rooms while traveling from city to city, since those rooms are not treated as the employer’s place of business. The same holds for displaying products at a trade show, provided selling actually happens there rather than just sales promotion; a trade show of short duration — one or two weeks — is not counted as the employer’s place of business either. Meeting the duties test does not excuse a failure of this location test: an employee can have every duty of an outside salesperson and still fail the exemption if the selling itself happens at a fixed site rather than out in the field.
Key terms
outside sales employeeemployer’s place of businesscustomer’s place of businessfixed sitehotel sample roomtrade show