Employee Law Group - Unpaid commissions

How to recover unpaid commission in California

Sales isn’t easy. It takes hours of work, relationship-building, phone calls, and countless emails. But when you finally win over a new customer, the sense of satisfaction and achievement, not to mention the commission, makes it all worthwhile.

Commissions are wages under California law, which means your employer can’t refuse to pay them. If you’ve made sales but haven’t seen the reward, you have every right to take action and recover unpaid funds.

Here’s how to secure the unpaid commissions you are owed.

Step 1: Check your commission agreement

Are you confident you know with certainty how much commission you are owed and how it’s calculated? Or are you making assumptions on past or colleague experiences? Before you escalate your suspicions, be sure to double-check the commission agreement in your employment contract.

Your employer is only liable to pay you commission according to the employment contract you have signed. If the commission agreement is vague, you may have a more difficult time proving that you’ve been wronged. If there’s a lesson to be learned, it’s asking an employment lawyer to run their eyes over your contract before you sign so they can pick up any ambiguities your employer could use to argue their way out of a sticky situation.

Step 2: Chat with your employer directly

The next step is approaching your employer directly. In some cases, an unpaid commission is little more than a misunderstanding and will quickly be remedied following a friendly conversation. Always give your employer the benefit of the doubt.

If they agree to pay you, case closed. If not, however, hear their reasoning. This will help you determine how strong your case is against them. Be sure to keep a record of all communications related to your unpaid commission claim in writing – this is the critical evidence your attorney will use to fight for you. With that in mind, keep your tone polite, professional, and cordial. You may be angry, but don’t say anything you wouldn’t want to be read aloud in court.

Step 3: If your employer is insolvent, consider your options

If a conversation with your employer reveals the company is in serious financial hardship and needs more time to pay your commission, consider accepting a payment plan. While you might not get immediate access to the funds you’re owed, it could wind up being faster and less stressful than instigating a legal claim.

If you no longer work for the company and the company has since declared bankruptcy, try to determine whether they have the assets or funds available to pay the commissions you are owed. In other words, investigate whether they’re worth going after.

Step 4: Contact an experienced employment lawyer

If you are owed unpaid commission in California, an experienced employment lawyer can help you recover the funds owed and, in some cases, interest and other penalties. The team at Employee Law Group has years of hands-on experience, and we know the law inside and out. We can gather the facts of your case and build a strategy that avoids many of the common pitfalls claimants make when going it alone.

We can help you:

• Get your hands on the funds you are rightfully owed.
• Maximize the amount you recover.
• Pre-empt your employer’s defense and build a solid case against it.
• Gather evidence – remember, the burden of proof is on you.
• Investigate whether other employees have unpaid commissions and, if so, file a class-action lawsuit.

If you are concerned about the fees that come with professional counsel and representation, don’t be. In California, employers are required to pay the employee’s attorney fees in successful unpaid commission cases. So your attorney fees won’t eat into your total recovered funds.

Recovering unpaid commission FAQs

Can my boss fire me for filing an unpaid commission lawsuit?

No. You cannot legally be fired for exercising your rights. In fact, in addition to unfair termination, your employer can’t take any retaliatory action , such as blocking your access to professional opportunities or favorable assignments and demotion.

How long do I have to file an unpaid commissions case?

In California, the statute of limitations on most wage violations is two to four years from the most recent violation:

• If your unpaid commissions case is founded on a verbal agreement, you’ll need to file a claim within two years.
• If your unpaid commissions case is based on a written agreement, you’ll need to file a claim within four years.

How do I prove that my employer owes me commission but refuses to pay?

If you suspect you aren’t being paid the commission you have rightfully earned in accordance with your commission agreement, keeping records is critical. Track the type and amount of work you put into closing each sale. Write down other relevant details, too, such as the importance and dollar amount of the sale, the work you did to upsell, competitors you replaced, and referrals the company received from the customer you won.

You should also collect records of all relevant communication between yourself and your employer. Forward emails from your work address to your personal address, just in case you lose access to your work emails. If you discuss your unpaid commission over the phone or in person, follow up with a brief email detailing the main points of the call.

Claim the commission you earned

You put in the hard yards, and now, you expect the reward. If your employer is wrongfully refusing to pay you the commission you earned, you don’t have to sit idle and let them get away with it. Commissions are wages, which means you are legally entitled to them.

Our team is ready to fight for your rights. Get in contact with the Employee Law Group team, and let’s win the funds you are owed.

Schedule your private consultation today.