My employer says they will not pay me commissions on sales I’ve made unless the customer pays by my last day of work, is this legal?

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My employer says they will not pay me commissions on sales I’ve made unless the customer pays by my last day of work, is this legal?

I’m a commission salesmen and the way my company has it set up is: customer orders, product is shipped/invoiced, when the invoice is paid, I receive my commission. I am starting a new job in 2 weeks and they told me that they will not be paying me the commissions due on outstanding invoices unless those invoices are paid by my last day of work.

Asked on June 6, 2012 under Employment Labor Law, Oklahoma

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

This is legal if it was the policy or agreement in place. The fact that you are only paid on receipt of payment does not, by itself, mean that the order must be paid prior to your last day of work--it would be perfectly legal and practical to send you a check later. So the key issue is, what exactly is the policy? In the absence of anything stating that you would only be paid if employed when the payment is received from the customer, you would have a good case that you should be paid for sales you made, regardless of when the customer pays.

Bear in mind, though:

1) While I think, based on what you have written, that you'd have a "good case," no case is ever certain; i.e., you could lose.

2) If the employer will not pay you volutarily, you'd have to sue to get the money, which may or may not be worth it.

3) It could be very hard to "police" your company's performance of any obligation to pay after you leave--as a practical matter, how would you know when or whether payment was in fact made (vs. the account be charged off as uncollectable, or the customer seeking a refund, etc.)?

In short, unless it's a lot of money, it may not be worthwhile taking legal action.


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