Legal Question in Employment Law in California
Repayment of commissions after resignation in a sales position
I was hired into a company on a manager's verbal misinterpretation of their compensation plan. After I discovered the problems inherent to the company I resigned after four months. I received two months of a guaranteed commission that my former employer is now trying to collect. After further examination of the written compensation plan, it does call for repayment of the guarantee if I resign prior to six months. I accepted the terms of the plan and signed an agreement. What rights do I have in keeping the guaranteed commissions? Does it matter that the manager (who has also resigned) brought me on board by misrepresenting the actual plan? Thank you.
2 Answers from Attorneys
Re: Repayment of commissions after resignation in a sales position
Unless you signed or had prior notice of the written plan, the company may be stuck with what was told you orally.
Re: Repayment of commissions after resignation in a sales position
This response assumes you work in California for a California employer. Generally, if litigated, a court will require the parties to a valid contract to do or not do the things stated in the contract. This general rule may be overcome under certain special circumstances. One such special circumstance involves interpretation of ambiguous terms set forth in a contract that was prepared by the party who was in the strongest bargaining position (e.g., in your case, the employer). If the contract was vague, ambiguous, or subject to multiple meanings, generally a court will interpret the contract against the party who prepared it. In your case, this principle may not be applicable since you indicate the contract was clear regarding your duty to repay commission advances. Under this scenario it is more likely than not the contractual repayment provision would be enforceable. However, you should seek the advice of legal counsel it you feel the writing is suspect. As a general rule, you should not sign a writing unless you have read the entire writing, and understand fully your rights, benefits and duties.