Has your employer failed to pay you the commissions or bonuses you have earned? At Ferraro Vega we are here to fight for you and uphold your legal rights. Contact us today at (619) 693-7727 for a free consultation with a San Diego bonuses & commissions lawyer.
California employment law protects employees from unfair and illegal labor practices like withholding earned wages. You may have a claim against your employer for the unpaid wages you are owed in addition to penalties. We represent employees in all industries on a contingency-fee basis.
How Ferraro Vega San Diego Employment Lawyers Can Help with Your Bonuses and Commissions Dispute
You depend on the commissions and bonuses you earn. When your employer does not pay you the wages you have earned, you are protected by California labor laws. However, you may be hesitant to exercise your rights for fear of retaliation or not know what steps to take to recover your unpaid wages.
A San Diego employment lawyer can be an invaluable partner in seeking the compensation you deserve, upholding your legal rights, and fighting back against any retaliation you face. At Ferraro Vega San Diego Employment Lawyers, we focus entirely on employment litigation. Our years of experience and expertise in this complex area of law will be put to work on your behalf.
Choose Ferraro Vega San Diego Employment Lawyers and count on us to:
- Determine which labor laws your employer may have violated
- Assess if other employees have been affected by employment law violations
- Determine your best legal options for recovering unpaid compensation and penalties including a wage claim, lawsuit, PAGA claim, or class action
- Handle negotiations on your behalf with your employer
- File a lawsuit if a fair settlement isn’t reached to fully compensate you
You do not have to go up against your employer on your own. Our San Diego bonus and commission lawyers work on a contingency-fee basis to provide sound legal advice to all employees in San Diego, California. Call us today to schedule your free consultation and put our experience to work for you.
What Are My Rights to Commissions in San Diego?
A commission is an employee’s earnings based on a percentage of payment their employer receives for services or goods sold by the employee. Some salespeople in California are only paid based on commission while others receive compensation that includes wages and commissions.
Under California law, commissions are considered wages. This means you have the same rights that apply to other types of earned wages under California wage and hour laws.
California Labor Code Section 2751 requires that employees and employers enter into a written agreement when a commission makes up any portion of the employee’s compensation. This agreement must specify how commissions are calculated and when they are earned.
For example, the written agreement may state that a commission is earned when a delivery is made, when a customer signs a sales agreement, or when the customer pays on an invoice or for goods.
It is not only the amount of the commission and when it is earned that matters. A good agreement also covers what happens if more than one employee contributes to a sale or qualifying commission-earning event and whether the commission Is based on gross revenue or profit.
When a commission is earned, it is considered an earned wage and must be paid on the same schedule as the employee’s other wages. As a commission-earning employee, you have the right to commissions you earned even if you are terminated or separate from your employer. You have the right to pursue a claim for unpaid wages if you are not paid the wages you are owed or your employer does not pay wages in a reasonable amount of time.
What Is the Difference Between Discretionary and Non-Discretionary Bonuses?
There are two types of bonuses employees may receive: discretionary and non-discretionary bonuses. These types of bonuses are treated differently than commissions.
A discretionary bonus is a bonus paid to an employee without being based on a specific reason or criteria. These bonuses are within the employer’s discretion and not something an employee can count on.
Non-discretionary bonuses are compensation promised to an employee based on specific terms of a binding bonus plan. When an employee meets the performance terms of the agreement, they are entitled to a bonus.
There are several ways to determine if a bonus is non-discretionary or discretionary.
A discretionary bonus:
- Is not dependent on or based on productivity, hours worked, performance, or efficiency
- Is not so substantial that employees consider it part of their wages
- May include Suggestion Awards if the amount is not attached to earnings, is an actual award for a suggestion, does not come with a time limit, and does not require that employees participate
Non-discretionary bonuses are generally treated the same as commissions in a wage and hour dispute. Discretionary bonuses, however, are not considered “earned” wages. These bonuses are not used to calculate an employee’s regular rate of pay or overtime rate. An employee generally can’t pursue a claim against their employer for failure to pay a discretionary bonus.
Do Bonuses and Commissions Affect Overtime in California?
The commissions and non-discretionary bonuses you earn are not treated separately from your regular wages when used to determine your overtime pay. Both affect your regular rate of pay, or the hourly rate used to calculate your overtime rate.
When you earn a commission or non-discretionary bonus, your overtime rate for that pay period is not time and a half or double time; it may be higher. However, it is common for employers to fail to consider bonuses and commissions when paying overtime. This means you may be shorted wages you are owed.
When Do Commissions and Bonuses Need to Be Paid in San Diego?
Employers have a clear requirement to pay all non-discretionary bonuses and commissions in a timely manner. Under California Labor Code Section 207, employers must establish regular paydays and pay earned wages promptly. Wages that are earned between the 1st and 15th must be paid by the 26th of the month in which they were earned, for example, or within seven calendar days of the end of the payroll period in which they were earned.
To properly determine overtime based on your regular rate of pay with a non-discretionary bonus, the bonus is divided by the maximum legal regular hours you worked in the pay period, not by the total hours you worked. Overtime is then paid at 1.5x or 2x your regular rate.
Discretionary bonuses are not used to determine your regular rate of pay.
If your employer unreasonably delays commission or bonus pay, they may be required to pay the wages you earned plus penalties.
Can I Sue My Employer for Failing to Pay Commissions and Bonuses?
If your employer failed to meet their requirements for paying bonuses and commissions, you may be entitled to your unpaid wages plus penalties.
This may include:
- The unpaid commissions or bonuses you are owed
- Interest on the unpaid wages
- Waiting time penalties
- Wage statement penalties
- Attorney’s fees
If other employees were also shorted on pay or suffered similar wage violations, a labor class action may be appropriate. Labor violations that affect multiple employees may also qualify for a PAGA claim that allows you to recover penalties for yourself, other employers, and the state of California.
At Ferraro Vega San Diego Employment Lawyers, we will begin by investigating your case and reviewing documents and communications. We will prepare a legal complaint or demand letter to seek the full amount of unpaid wages and penalties you are entitled to. If your employer will not pay the wages you are owed, a lawsuit will be the next step.
An alternative to a lawsuit is filing a wage claim with the California Division of Labor Standards Enforcement (DLSE). With this option, the DLSE will investigate your complaint and hold a hearing then decide on your case. If the DLSE decides in your case, you will receive a judgment against your employer.
The types of damages you can recover depend on the type of case you file. Your San Diego employment lawyer will help you understand your options and offer legal advice on the best approach to recovering the full compensation and penalties you are owed.
Schedule a Free Consultation with a San Diego Bonuses and Commissions Lawyer
When your employer fails to pay you the bonuses and commissions you earned, or does not calculate the correct overtime pay based on commissions, Ferraro Vega San Diego Employment Lawyers is here to help. Our San Diego bonuses and commissions lawyers will help you file a claim for the unpaid wages you deserve and fight back against any attempts to retaliate against you.
Contact us today to schedule a free case review with a passionate San Diego employment lawyer ready to help. We work on a contingency-fee basis: you pay nothing out of pocket for the legal representation you deserve.