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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Legal
Satisfied Customers: 117368
Experience:  JA Mentor -Attorney Labor/employment, corporate, sports law, admiralty/maritime and civil rights law
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I was an at-will employee NY based firm over three years.

Customer Question

I was an at-will employee for a NY based firm over three years. To gain employment, I signed a rather punitive offer letter, which stated that I was only entitled to "payroll" or salary should I "leave." I didn't 'leave' but was laid off or terminated for no cause on 5/15/2015. The former employer is now holding back due commissions totaling $5,300., illegally terming this amount as being "severance', wanting me to sign a punitive severance agreement first to receive these monies. Would these monies be termed 'wages' under Labor Law 191-C, which states that an employer must pay a former employee any due commissions within ...."five business days after termination?" I am thinking about filing a NY County civil action. Thank you so much for any clarifications surrounding offer letters and severance agreements here.
Submitted: 2 years ago.
Category: Legal
Expert:  Law Educator, Esq. replied 2 years ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
Under NY law, commissions are considered wages due at termination and if the employer is not paying the employee the wages due upon termination, then the employer can be sued for non-payment of wages and you could seek up to 2 times wages due for damages for the non-payment of wages.
Commissions are considered wages though under NY law, they are not a bonus, which would not have to be paid on termination.
Customer: replied 2 years ago.
Thank you for your quick response. So, in this case, the offer letter regarding 'payroll' would also extend to commissions by law.
Expert:  Law Educator, Esq. replied 2 years ago.
Thank you for your reply.
Yes, if commissions were part of the employee's pay and not a bonus (which is considered a gift to the employee) the employer must pay them as wages when they are due, even if the employee is terminated.