Is it legal for your supervisor to deduct 50% ofyour commision for not furnishing an e-mail address from a customer.

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Is it legal for your supervisor to deduct 50% ofyour commision for not furnishing an e-mail address from a customer.

Auto dealership sent e-mail stating that there will be a 50% deduction from commissions if customer’s e-mail address is not obtained. Manufacturer evidently told dealer that 80% penetration of e-mail adresses must be maintained or they also will not pay out reward monies for sales bonus starting 10/01/10.

Asked on September 28, 2010 under Employment Labor Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

As long as (1) the auto dealership has notified its sales representatives of the policy, making it a known term and condition of employment, and (2) they are only doing it on a forward-looking basis, for commissions earned after the policy is put in place, then yes, it is legal. Employers have enormous discretion to set up terms and conditions of employment, or the criteria to earn commissions. They can't do this retroactively, for commissions earned prior to the policy, since those commissions were earned under the then-in-force terms, conditions, etc.; however again, on a going-forward basis, this is something they can do for both commissions and also, as you note, for sales bonuses, reward monies, etc.


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