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Patrick, Esq.
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Category: California Employment Law
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Experience:  Significant experience in all areas of employment law.
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I have a signed agreement for a salary position for 6 months.

Resolved Question:

I have a signed agreement for a salary position for 6 months. After 8 weeks of employment they said they need to move me to commission only and to think about it and get back to them. I emailed a letter telling them I would take a decrease in salary in good faith for the remainer of the 6 months and then the position could be reviewed as we agreed. Its been 4 days and I have heard nothing from them and I have been working. Should they pay me my orginal salary? Can they do this after only 8 weeks? Do they need to give me notice first? I was given nothing in writing yet of any changes.
Submitted: 5 years ago.
Category: California Employment Law
Expert:  Patrick, Esq. replied 5 years ago.
Hello and thank you for entrusting me to answer your question. I am very sorry to hear that your employer is attempting to reduce your pay.

Does your signed agreement expressly entitle you to your original salary for the entire 6 month duration of your contract?
Customer: replied 5 years ago.
It only stats my salary information, vac pay and the end stats the position will be evaluated in 6 months.
Expert:  Patrick, Esq. replied 5 years ago.
Thank you very much for that information.

Unfortunately, unless an employment contract guarantees employment for a specified period of time at a guaranteed wage, an employer retains the ability to change an employee's rate of pay at any time.

This tremendous freedom stems from Labor Code section 2922, which provides that employment in the state of California is "at will," absent an agreement to the contrary. Courts have interpreted this to mean that, since an employer retains discretion to terminate employees for no reason, he or she also retains the authority to dictate the terms of employment and change them at any time.

Any employer need not provide any advanced notice of a change in the rate or method of pay, nor must the notice be in writing (though this is usually a good idea for the employer). As soon as the employee is made aware of the change, it can take effect. By continuing to work following notice of the change in pay, the law regards XXXXX XXXXX as impliedly consenting to the change, since they are (at least in theory) free to leave and find a different job at any time.

Thus, if an employer informed you that you were being switched to a commission basis, that change would take effect immediately even if you objected to it or attempted to negotiate something different.

I realize that this is not exactly what you were hoping to hear, and I am sorry to delivery this news. Nonetheless I trust that you will appreciate an honest and direct answer to your question.

I sincerely XXXXX XXXXX this information helps you and I wish you the best.

My absolute greatest concern is that you are satisfied with the answer I provide, so please do not hesitate to contact me with follow-up questions. Also, please bear in mind that none of the above constitutes legal advice nor is any attorney client relationship created between us.
Customer: replied 5 years ago.
Since commission only with this type of business (medical sales) doesnt allow me wages for several months, should they be allowed to pay mileage, car allowance or cell phone reimburstment? If not can I ask them to let me go instead an try to go back on unemployment? I was on unemployment for 16 months before finding this job! What a mistake I made!
Expert:  Patrick, Esq. replied 5 years ago.
Sales employees who do not work in excess of 50% of the time in "outside sales work" (meaning away from the employer’s place of business) must be paid at least minimum wage and minimum overtime wages for all hours worked. If an employee makes no sales and therefore earns no commissions, the employer is required to pay minimum wage and overtime for the hours worked during that pay period.

The exception to this rule, as noted above, is for "outside sales work." See here for more information regarding that exception: Otherwise, minimum wage must be paid if commissions would equal a lesser amount for the pay period.

Unfortuantely, an employee must typically be involuntarily terminated in order to be eligible for UE benefits. Thus, an employee cannot typically "ask" to be let go if they wish to be eligible.

Again, I am very sorry to deliver this unfortuante news to you but trust that you will appreciate knowing how the law operates under these circumstances.
Customer: replied 5 years ago.
I am sorry I do not understand. Please verify I am 100% outside medical sales and I carry items in my car to pass out to offices to obtain contracts and services. I am exempt from minimum wage, car allowance,etc. because I am straight commission and work outside the office?
Expert:  Patrick, Esq. replied 5 years ago.
Thank you again for your reply.

Please understand I cannot tell you what you are because I do not have every single relevant fact and I cannot provide "legal advice," which such an assessment might be construed as. I can simply provide you with the legal information you need to make that assessment for yourself.

Generally speaking, "outside sales persons" are exempt from minimum wage and they can be paid on a straight commission basis without any entitlement to minimum wage. The Wage Orders define outside sales persons as:

"Outside salesperson” means any person, 18 years of age or over, who customarily and regularly works more than half the working time away from the employer’s place of business selling tangible or intangible items or obtaining orders or contracts for products, services or use of facilities."

Please review the link supplied above for additional information regarding the outside sales person exemption.

Again, I sincerely XXXXX XXXXX this information answers your question and I wish you the best.
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