I was a account executive doing sales mostly on 60 month contracts paid commision. after contracts come up for renewal I get paid again. after 5 years I was told I could not renew them but i will get a 13 percent residual on each account. so at my 5 and a

I get fired and not paid on my accounts. he kept it all. after waiting over 5 years to get paid. I got nothing. is that legal what he did

1 answer  |  asked Mar 13, 2016 1:19 PM [EST]  |  applies to New York

Answers (1)

V Jonas Urba
Here is what the New York State Department of Labor says about commissions due to commissioned sales persons. If you are owed monies and the DOL can not help you then, depending on the amount in controversy, and the language of your agreement, you may have to pursue litigation. Consult with a labor and employment lawyer if you need to do so.

"Payment of Commissions Frequently Asked Questions (FAQ). Article 6 of the New York State Labor Law sets forth various requirements relating to the
payment of wages to individuals who work on a commission basis.

Commissions: A commission is compensation based on a percentage of or some other amount based upon a salesperson’s orders or sales.

Commission Salespersons: Under the Labor Law, a commissioned salesperson is an employee whose principal activity includes sales and who is paid, in whole or part, on a commission basis.

The Labor Law excludes employees whose principal activity is of a supervisory, managerial, executive, or administrative nature.

Written Agreement: The Labor Law requires that a commission salesperson’s pay/employment agreement must be in writing and signed by both the employer and the salesperson. It must contain:
ƒ
A description of how wages, salary, drawing accounts, commissions, and all other
monies earned and payable will be calculated,

How often the employee will be paid (See Frequency of Pay FAQs),

The frequency of reconciliation (if the agreement provides for a revocable draw),

ƒAny other details pertinent to the payment of wages, salary, drawing accounts,
commissions, and all other monies earned and payable when the employment
relationship ends.

Statement of Earnings: The employer must provide the commission salesperson, upon written request, with a statement of earnings paid or due and unpaid.

When is a commission considered to be “earned?” The commission will be considered “earned” at the time specified in the written employment agreement. If the agreement is silent on this topic, a commission is considered to be earned in accordance with the past dealings between the employer and commission salesperson. If there are no such past dealings, then a commission is considered earned when the commission salesperson produces a person ready, willing, and able to enter into a contract upon the employer’s terms.

Once a commission is “earned,” it is legally considered “wages” under the Labor Law and subject to all other provisions of the Labor Law regarding the payment of wages.

What, if any, deductions may an employer take from a commission salesperson’s
commission? Unearned Commissions (non-wages): Employers may make adjustments and/or apply charges in accordance with the applicable terms of the written employment agreement. For example, an employer may reduce an employee’s unearned commissions by any expenses incurred by the employee.

Earned Commissions (wages): Once earned, commissions are considered wages and deductions are limited to those permitted by Section 193 of the Labor Law. (See Wage Deductions FAQs).

Do any commissions have to be paid to a commission salesperson who has been terminated or left employment? All commissions earned by a commission salesperson are legally considered wages and must be paid to the salesperson even if the employment relationship with the employer has ended. If the commissions have not yet been earned, the terms of the written employment agreement –
which must include language addressing this situation – will control."

posted by V Jonas Urba  |  Mar 13, 2016 1:47 PM [EST]

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