Retroactive pay without signed agreement

I accepted a position in MA in May 2008 based on opportunity for growth. As I work in sales, I signed an employment agreement with my employer laying out my base salary and commission structure.

In early March 2009, we were informed a new commission plan would be structured. While this plan was expected to lower my commission, it also had a raise in base salary. It was also including goals for the year of 2009 that would be retroactively looked at.

I was presented this new plan a week before our next pay period and asked to review and sign. I have not signed this agreement as there is it raises questions, but my employer is not currently available due to travel.

Our payroll processed today and much to my surprise, I am missing moneys earned in commission given our old plan or even new plan. I have been informed that commissions were "overpaid" due to 2008 agreement terms and adjusted for 2009, taking money out of my pocket with no signature of a new agreement for. This relates to commission payments earned in January and Feb 2009. I have also not been given the pay raise I was expecting.

Is this kind of retroactive payment application legal? Should I not be receiving retroactive payment for the salary increase as well?

Please help.

1 answer  |  asked Mar 18, 2009 4:24 PM [EST]  |  applies to Massachusetts

Answers (1)

Judith Miller
Change in commission plan

There are two general rules that apply to your situation. First, unless you have a written employment contract which contains a specific agreement for continued employment for a particular term and states that your commissions/salary cannot be changed, an employer can change an employee's compensation, going forward, unilaterally, without the employee agreeing to the change or signing an agreement. Thus, once the commission plan is changed, the employer can pay according to the new plan as of the date you were notified of the change, even if you did not sign the commission plan agreement. What the employer cannot do, is retroactively change your commission plan. Thus, if the employer changed the way it computed commissions which were earned before you received notice of the change in the commission plan, the employer has probably violated the Massachusetts Payment of Wage Law.

posted by Judith Miller  |  Mar 19, 2009 07:36 AM [EST]

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