The people who loudly declare that work is for chumps are notoriously vocal, but if you stop to ask them questions about their anti-work stance, you will find that they are more diverse than you can tell simply from their loud slogans. Most of them will acknowledge that some types of work more clearly brand the worker as a chump than others do. For example, they may look down at their noses at people who earn an hourly wage, or even those who earn a monthly salary; they derisively regard these activities as “trading hours for dollars,” and claim that it is a futile pursuit, because each of us has only so many hours in a lifetime to spend working before old age, illness, and death come along to interrupt our plans.
The anti-work crowd looks more favorably on earning a passing income. You might be able to convince such people that you are not a chump if you invested your labor long ago, and the fruits of your labor turned into a payout, either all at once or over time, that adds up to vast sums for each hour that you spent working on it. You might be able to convince them that you are not a chump if you say that you get paid commissions, instead of or in addition to a monthly salary or hourly wage. Convincing your employer to pay you a commission is sometimes a challenge, since opportunities to earn commissions are, by nature, at least a little bit speculative. The commission disputes lawyers at HKM Employment Attorneys LLP in Boulder, Colorado, can help you collect commission payments that your employer unfairly withheld and draft commission agreements that make it easy to collect the commissions you earn.
What is a Commission Payment?
A commission is a one-time payment that a salesperson or sales broker receives when the sale of an expensive item of property becomes final or when a business deal reaches a stage where money changes hands. The commission is usually calculated as a percentage of the purchase amount or, less commonly, as a flat fee. Retail salespeople of big-ticket items such as jewelry, household appliances, and consumer electronics often earn commissions, and so do real estate agents in residential and commercial real estate transactions. Sometimes, people who act as intermediaries in business mergers receive commissions when one business entity completes the purchase of another. The seller and the broker usually agree on the commission amount before negotiations with the buyer begin. If the person earning the commission is a salesperson at a retail store, the commission rates are usually part of the company’s employee handbook or, if the employee has a contract, they are part of the employment contract. Unlike tips, which are paid by the customer, commissions are paid by the party that derives the greatest financial benefit from the sale.
Do Commissions Count as Wages, or are They Empty Promises?
The Colorado Wage Act holds that commissions and bonuses count as compensation, which means that employees must pay taxes on them. It also means that you can file a wage theft claim if your employer does not pay you a commission that they owe you, even if your paycheck accurately reflects the hourly wages you earned for the hours that you worked. You can only rely on the Colorado Wage Act in your wage theft claim if the commission is genuine, meaning that it is earned, if a written agreement governs it, and if it is possible to calculate the commission amount according to a mathematical formula.
Beyond these genuine, legally enforceable commissions, there are lots of empty promises arising from the kinds of far-fetched business plans of the sort that tend to hang in the air when business-minded men gather in the presence of alcoholic beverages. Commissions that the parties will allegedly receive “when our ship comes in” rarely materialize. If, at the time, the person who promises you the commission does not own the asset that they are planning to sell and pay you a commission, your chances of ever receiving the commission are slim. The matter is simply too speculative. It doesn’t hurt to enshrine the promises in a written agreement, in case all the stars align.
What Makes a Commission Agreement Legally Enforceable?
The Colorado Department of Labor has listed three criteria that a commission agreement must meet in order to be enforceable. These are the criteria:
- Earned – The employee performed work, namely facilitating the sale, to get the commission.
- Written – The employer and the employee agreed in writing what the employee must do to earn the commission.
- Determinable – The written agreement must specify the commission amount as a mathematical formula, such as “three percent of the sale price.”
As with any written agreement, the more specific your commission agreement is, the better.
Boulder Commission Dispute Lawyer
If your employer promised to pay you a commission that you have earned, but your employer has not paid, a Boulder employment lawyer can help you collect the money. Many commission disputes involve retail employees who quit or were fired after they finalized the sale on which they earned the commission, but before the date that their contracts stated that the employer must pay the commission. With commissions, as with any other aspect of business or employment, ambiguities in written agreements can cause trouble, almost as much trouble as not having a written agreement at all. If your employer’s decision not to pay the commission was a response to you engaging in a protected activity, such as reporting employer misconduct or joining a labor union, then this is a case of employer retaliation, which is always illegal. If the employer has routinely withheld commissions from employees who share the same protected characteristic, such as race or national origin, then it is a case of employment discrimination, which is also illegal.
Contact HKM Employment Attorneys, LLP, About Commission Disputes
The Boulder employment lawyers at HKM Employment Attorneys, LLP can counsel you about commission disputes. Call the employment lawyers at HKM Employment Attorneys LLP in Boulder, Colorado, to set up a consultation.
