Unpaid Bonuses and Commission

Answer:

I recently received a phone call from a salesperson who was frustrated that, despite working for the company, they weren’t being paid pursuant to the pay plan. I asked the question, “Do you know if you were receiving a bonus, or if it was part of a commission plan?” The person I was talking to sort of used those terms bonus and commission interchangeably. It’s interesting, in California law, sometimes the law treats bonuses and commissions differently. Whether or not an employee is entitled to a bonus will depend on certain facts and whether or not the employee is entitled to a commission is based on other facts.

I will say that California law is extremely protective of its employees. California law contemplates that if you work for an employer with the understanding that if you hit these goals, or if you do x, y, and z, or if you stay through this time period, that the employer is expected to pay that compensation. There will be fights between the employer and the employee as to whether or not it’s a discretionary bonus or whether or not it’s an earned commission. It’s important for you to understand that whether or not the employer has to pay you for the compensation that you believe you’re entitled to is a fact-intensive question; it’s not always a yes or no.

If you’ve been working for an employer and you believe you’re entitled to a bonus and/or a commission, it’s important for you to talk to an attorney that can walk you through everything. If you have questions as to compensation for a commission plan or a bonus plan, feel free to give us a call. I’m always happy to walk you through those issues and figure out whether or not you’re entitled to compensation. Thanks.