Under what circumstances can the payment of a commission be delayed?

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Under what circumstances can the payment of a commission be delayed?

My husband was due his commission from last year this past month, his company now says they will not pay until they see if the US Government is shutting down. This even though his sales were in 2010 and his company made money in 2010. Additionally, my husband’s sales were commercial not government contracts. Is this legal?

Asked on March 16, 2011 under Employment Labor Law, Virginia

Answers:

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

It sounds as if the company doesn't have enough accounts receivable to make up for the accounts payable.  If your husband was a due a commission from 2010 and it is owed to him in March, and the company is not paying, your husband needs to do a couple of things. First, check his employment agreement with the company about such companies and how long the company has to pay them. If the contract is silent, one has to look at law, case law and also what a reasonable time period would be in his situation. If he is an employee (so has an income via salary or hourly in addition to commission), he should file a complaint with the Virginia Department of Labor. If he is not, he should make an appointment to talk with the local, state or federal prosecutor's office to help get this straightened out. I say this because if the company also handles government contracts, the company has to meet strict guidelines that include factors like financial health.


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