Legal Question in Business Law in California
commissions due
I was laid off today and was told
they would not pay my commissions
oncontracts that were completed
but not paid for yet. I was told that
those commisions would now be
paid to someonelse. They told me
company policy was that
commissions were paid to me the
first month I worked. Is such a
policy legal.
3 Answers from Attorneys
Re: commissions due
Legal? Sure. The employer determines policies.
Now, you could file a claim with the Labor Commissioner and try to show you are entitled to the commissions under their policies and practices. You have nothing to lose by doing so.
Re: commissions due
A company is free to pay commissions according to a policy of its own authorship, including a policy that says the commission goes to the incumbent at the time the customer pays the invoice. However, the company's commission policy must be made known to the salespeople and cannot be changed retroactively once the salesperson has done work that may result in the commission. In other words, the company cannot manipulate its policy to do a commissiondectomy on the salesperson. I can't tell for sure what's going on here; if you received the policy in writing, review it to make sure it's now being followed. You are entitled to notice of a downgrading in policy before you do the work, not later on. Once you've set up a possible commission by your efforts, it should be yours if existing policy says so, and a change after you've done the sale is an unfair practice.
Re: commissions due
If you have a written contract it should specify when commissions are earned and when they are paid.
If there is no written contract, is there a written policy anywhere?
If there is no written policy what has been the custom and practice of this employer?
The real question is when commissions are earned, on closing of the sale or on payment of the invoice.
There is no hard and fast rule about this.
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