Disputes Between Employers and Employers Regarding Commissions
Commission-based compensation is a common payment structure in many sales-based positions. They operate by paying an employee a percentage or set fee for every sale made, and the main idea behind paying an employee on commission is that it incentivizes an employee to produce more profit for the company. An issue arises, however, when an employer is under the mistaken belief that commission-based employees are somehow not covered by state and federal employment law protections.
If an employer withholds a commission payment, an employee may be able to bring a legal action to collect the money that is owed to him or her. A dispute regarding a commission payment may arise due to a misunderstanding regarding the compensation agreement, or perhaps due to an unscrupulous employer wishing to retain more profit. Regardless of the circumstances, it is important for any party to a commission dispute to retain legal representation immediately after the dispute becomes apparent. The Colorado employment law lawyers of HKM Employment Attorneys represent both employees and employers involved in commission disputes, and work hard to resolve each case we handle to the best possible outcome.
Federal law requires that commission based employees covered under the Fair Labor Standards Act are compensated at a level of at least equivalent to minimum wage, which in Colorado was $7.78 per hour as of January 1st, 2013. In addition to these federal protections, Colorado Revised Statutes 8-4 109(1) and 8-4 109(2) require that an employer pay an employee any commissions earned at the time of discharge from employment, if the discharge is initiated by the employer. It is advisable that any commission-based employment contract be made in writing, as it can help resolve or clarifying misunderstandings, potentially avoiding costly litigation.
Employment Lawyers in Colorado
The denial of a commission payment can cause serious financial strain, particularly if most or all of your income is commission based. Employers also need to make sure that they are maximizing their profit and not paying out commissions that have not been earned, and need to protect themselves from frivolous lawsuits. The lawyers of HKM Employment Attorneys represent a diverse group of clients, including employees, employers, small businesses, and government agencies. We bring our almost 4 decades of combined experience to bear in every case we handle, and work tirelessly to resolve our clients legal matters as quickly and efficiently as possible.
If you are an employer or an employee involved in a commission payment dispute, contact a Colorado employment lawyer today to retain legal representation.