What laws are applicable to commission based employees not receiving payment upon completion of their task?
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What laws are applicable to commission based employees not receiving payment upon completion of their task?
A commission employee interior designer is
being denied payment upon the sale
completion of a job. The employer claims that
the payment is due when the outsourced
workforce/builders,finishes their task is when
payment is due. This employer also
refused/neglected to discuss the time frame of
payment before the employee’s change to
commission only.
Asked on September 8, 2017 under Employment Labor Law, Georgia
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 7 years ago | Contributor
There is no law relating to when a commission is due--it is based on the company's policy and/or the agreement/arrangement between the company and the employee. It is legal to pay a commission on completion of the work; it is also legal to not pay until the employer receives its payment or the client has fully signed off and approved the final work.
If there is no employee handbook, offer letter, correspondence between employer and employee, etc. showing when payment is due, if the employee were to sue for the money, a court would look to past precedent at this company--when was this employee paid in the past? When were similar employees paid?--to detrmine what the terms or agreement for the commission likely was; what was done in the past will be a guide to what should be done now.
If there is past precedent from this company, then typically you would look to the industry: what is generally done (i.e. when are designers generally paid) in this geographic area in this industry? That would inform when this employee should be paid.
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