If you work based on commission, you are entitled to compensation for making sales or completing tasks. In California, commissions are not classified as discretionary, meaning that an employer cannot withhold your payment, as long as you meet the requirements for commission. In addition to commission, all employees are entitled to a base rate of pay If you have questions regarding your commission, or your Employer failed to pay your base salary, please contact our attorneys at Employment Rights Law Group.
Inside Commission Pay
Salespeople who work in-house and are being paid based on sales commission, are entitled to receive minimum wage. However, some in-house sales people are considered exempt if:
1) The salesperson earns more than 1.5 times the minimum wage;
2) The sales person is engaged in a professional, administrative or executive role; and
3) The exemption applies specifically to employees covered by Wage Order No. 4 (the mercantile industry, which includes retail sales) and Wage Order No. 7 (“Professional, Technical, Clerical, Mechanical, and Similar Occupations”).
If the in-house salesperson is considered exempt, then the employer does not owe any wages for overtime, off-the-clock work, rest or meal breaks.
However, if the in-house sales person is non-exempt, then the employer must pay the salespeople the minimum wage and then commissions.
Outside Commission Pay
• Applies to the salespeople who spend more than half their work time away from the employer’s place of business; and
• Earn commissions from sales of products, services, or use of facilities.
Outside commission-based employees are usually not subject to wage and hour regulations. However, commission-based employees must receive reimbursement for their personal expenses related to their employment. Such expenses include mileage, reimbursement for any items that the salesperson purchases, clothing items and also cell phone usage. If you worked as an outside salesperson, and you received commission, then your employer must reimburse you for your personal expenses. If you have not received any reimbursement, please contact our team of attorneys at Employment Rights Law Group to discuss your case.