Mehtani Law Offices attorneys represent employees in sales and other fields who are paid all or partially based on commissions, bonuses, or other forms of contingent compensation.
The term “commission” refers to earnings based on a percentage of the price of goods or services an employee is involved in selling. Importantly, a payment that is discretionary rather than mandatory (e.g., a seasonal bonus, which may or may not be awarded, in the employer’s discretion) is not a commission.
California has particular laws regarding the payment of commissions and contingent compensation. For example, employers must give employees paid on commission a written agreement setting forth how the commission will be calculated and paid. Further, your employer is obligated to obtain a signed receipt from you, acknowledging that you received the written agreement.