Can my employer keep earned bonus/commission money if I resign?

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Can my employer keep earned bonus/commission money if I resign?

I am a salaried employee who also earns $2,158 bi-weekly in commission/bonus money. My employer wants me to now sign an agreement if I resign I forefit my $24,000 that is paid out over 6 months. This money is already earned from the previous 6 months.

Asked on August 12, 2011 New York

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

In the absence of a new agreement, your employer is bound by whatever the terms were under which you earned those commissions. So if when you earned them, the terms and conditions of employment were that if you resigned, you could keep all commissions you earned, your employer must honor that. (If there is no agreement and nothing in an employee handbook or the like setting out what happens to commissions on resignation, look first to past precedent--what has happened when other people left?--and then to the industry norms, to try to see what reasonably what the agreement between the company and employees like you.)

If under the existing terms of your employment, you could keep the commissions in the event of resignation, then the issue becomes whether the company makes it worth your while to sign the new agreement. They could offer you pay, benefits, a promotion, a higher commission rate, etc. to sign; they could also threaten to fire you if you don't, though in that case, you'd presumably get to keep the commissions.


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