Variable Comission without prior notice


I joined my company 3 yrs back with base pay at 15% was a fairly new company and i was the first sales manager too. In span of 3 yrs, every year our revenue has reached new heights. I am still the only sales person in company.

Here is my employer has reduced my comission to 8% last year using economy excuse but still our company made more profit than previous year. My employer also told me that i have been failed to bring new clients...but my old clients keep giving me more business.

Now today..I strike another deal and he reduced my comission again ( after the deal was made ). His excuse was more expenses to get work done. I asked for clarification buy i didnt receive any.

My biggest problem is..there is no contract between my and my employer..everything is verbal. I have emails and pay stubs to support my case..nothing other than that.

I have kept my mouth shut because of economy, but as company we are doing better than previuos fiscal year. I just want to know how should i approach this situation to my employer..and if he denies my request..are there any laws to protect me?

1 answer  |  asked Jun 10, 2010 3:13 PM [EST]  |  applies to Texas

Answers (1)

Thad Harkins
You might bring a claim for the commissions as a breach of oral contract in court, or file a wage claim with the TWC wage division. Links to explaining this process and the form are at:
Though the federal minimum wage and overtime laws also have an "anti-retaliation" provision, there's not any job protection for you under Texas law if you do file a claim under state law, so your employer could conceivably fire you if you bring either suit or a wage claim. Generally, the since your employment is "at will" without a written guarantee of continued employment, your employer can let you go unless there's a specific law that protects your job (like discrimination, FLSA retaliation, workers comp retaliation, etc.), even if it's unfair.

The TWC unemployment laws do provide that if your "hiring agreement" changes, you may have a right to get unemployment benefits if you quit because of a reduction in pay (the rule of thumb is that you get benefits if your pay is reduced at least 20- 25% by the employer's unilateral change in the compensation terms), but whether you are willing to give up the job for unemployment benefits (appx. $400/wk. max) until you find another job is really a decision you have to make if you quit over this.

You may want to get a lawyer in your city or area to meet with you, and evaluate whether the unpaid commission claim is worth pursuing and risking termination, or can give you tips in negotiating a written commission agreement to present to your employer, if your client base gives you any leverage to negotiate a higher % rate like the one you started with.


posted by Thad Harkins  |  Jun 14, 2010 4:42 PM [EST]

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