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Patrick, Esq.
Patrick, Esq., Lawyer
Category: California Employment Law
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I worked as WC independent territory sales rep for a jewelry

Resolved Question:

I worked as WC independent territory sales rep for a jewelry manufacturer and my position was terminated in October 2011. I am owed commissions from sales orders dating Sept thru November. The company is based in TX and I was told that I would not get paid until they get paid by the jewelers. The goods I sold in have been shipped. Please tell me if I am to wait for payment or if the Company is to pay my commissions 30days from last day worked.
Submitted: 5 years ago.
Category: California Employment Law
Expert:  Patrick, Esq. replied 5 years ago.

LegalPro54 :

Hello and thank you for entrusting me to answer your question. I see that you have listed this as a CA employment law issue but yet the company is located in Texas. Have you been working this time in the state of California?

LegalPro54 :

I will assume for the sake of my answer that you have been working out of the state of California, which would mean that California and not Texas law would apply. California law holds that commissions are "wages" within the definition of the Labor Code.

LegalPro54 :

Labor Code 201 provides that all wages must be paid to an employee immediately upon their termination.

LegalPro54 :

An employer can face penalties and fines for failing to pay all wages upon termination (See Labor Code 203)

LegalPro54 :

An individual in this circumstance should typically file a claim with California's Department of Labor Standards Enforcement. Here is a link to their website: http://www.dir.ca.gov/dlse/howtofilewageclaim.htm


 

LegalPro54 :

Now, the only potential issue here is that the commission has not yet vested.

LegalPro54 :

If the commission hasn't yet vested, then it would probably not be considered a wage presently "owed."

LegalPro54 :

If you can argue that the commission has vested, then the company would likely be in violation of Labor Code section 201.

LegalPro54 :

If this adequately answers your question, please click "accept" so that I get credit--otherwise, I will not be paid for my time. If I have not answered your question, please let me know how I can provide clarification and I will happily do so.


 


Also bear in mind that the above does not constitute legal advice, nor is any attorney-client relationship created between us. I am only providing you with relevant legal information, I am NOT making conlusions about the applicability of that information to the facts that you have described.


 

Customer: replied 5 years ago.
What constitutes as commissions not vested? The product has shipped to the account.
Expert:  Patrick, Esq. replied 5 years ago.
The commission is earned and "vested" when all conditions precedent have been satisfied. If your employer, by way of past practice or an employment contract has established that a commission is not earned or payable until payment from the customer has been received, you have not "earned" the commission until this condition precedent has been satisfied.

Accordingly, under the circumstances you describe, the commission is most likely not "earned" until your former employer has been paid. At that point, they would be required to immediately pay you for such commission pursuant to Labor Code 201.

I hope that this helps clarify. Again, please kindly remember to "Accept" if I have answered your question. Best regards.
Patrick, Esq. and other California Employment Law Specialists are ready to help you

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