Can an employer withold commissions owed if the customer doesn’t pay within 90 days?

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Can an employer withold commissions owed if the customer doesn’t pay within 90 days?

My wife’s company refuses to pay
commissions owed to sales people if the
customer doesn’t pay within 90 days.

Asked on February 26, 2016 under Employment Labor Law, Minnesota

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

That is perfectly legal. Companies may set any terms or conditions they like on the payment of commissions. While it is more common to pay, but then "charge back" against future commissions if there are any uncollected sales, bad debts, refunds, etc., it is legal to do it this way and simply not pay commissions if the company is not paid within a certain time frame.


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