Legal Question in Employment Law in California
surcharge on commissioned employees
In March of this year a gave all my commissioned employees a letter stating that I would begin a surcharge for the product they used on my clients. Three months later several left. Now one of them is involving the Labor Commissioner because they want to be reimbursed for this surcharge. I gave each commissioned employee a letter stating this deduction. I did not have them sign the letter. However, they kept working for three months after the being of the surcharge which gave ample time for them to take all my clients and set up shop down the street. Furthermore, the surcharge was clearly outlined on their paystubb, along with other taxes. By them signing the back of their payroll checks acknowledging their acceptance of this surcharge? I am not the militarty, they could have left at any time, in fact the letter stated such. Will I or will I not be obligated to pay them for their surcharge deductions? Should I retain an attorney?
Thank You
3 Answers from Attorneys
Re: surcharge on commissioned employees
Without knowing the specifics, it is impossible to address the issues, however, it is generally unlawful for employers to deduct from employees' paychecks anything other than legally required deductions. The "surcharges", as you call them, sound like illegal charge backs, which you cannot do. Nor can you condition an employee's continued employment or cashing their paycheck on accepting unlawful deductions from their paychecks.
You may be in serious trouble. It is in your best interest to consult with an employment law attorney that represents management, as soon as possible to assess any potential liability to may be facing.
Re: surcharge on commissioned employees
It depends what the "surcharge" is. Commissions are wages. Deductions from wages are, generally, illegal. There could also be a problem with changing a commission structure on commissions already earned. . . The documents you had your employees sign, and the paystubs are more likely to help the employees -- as evidence of what you did -- then be a defense to your case. You should hire a lawyer (and I don't know all the facts in your case, so I'm just giving you my general understanding of the law based on your general outline of the facts.).
Re: surcharge on commissioned employees
If the amount in controversy is enough to justify hiring an attorney, then the next question is whether you have any chance to win the hearing. You'll need to consult with counsel to review all the facts in order to get such answer. Feel free to contact me.
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