How Commission Work Can Cause Wage & Hour Claims


If your work is commission-based, you may find that you have some questions about your wages, and what your employer is required to pay. Commissions can be confusing, but that doesn’t mean that you should be forced to hope for the best when it comes to getting paid. Our Memphis hour and wage attorneys can help you understand what exactly you are owed, and can help you fight back if you discover that your employer hasn’t paid you correctly. Here are some of the issues you may face as a commissioned worker and how they can lead to a wage and hour violation claim.

What Is a Commission?

First, let’s define what we mean by “commission.” A commission is a sum of money paid to an employee upon the completion of a task. This model of wages is common in sales-based jobs to encourage employee productivity. Commissions can be paid in addition to regular wages or instead of a salary.

Do I Work For Free If I Don’t Make a Commission?

If you are a commissioned worker, you still must make the federal minimum wage, according to the Fair Labor Standards Act (FLSA). Tennessee abides by the federal minimum wage, so this means that your employer is obligated to ensure you are paid $7.25 an hour for your work, even if your salary is commission-based.

For example, if your commissions on a slow week average out to $2.50 per hour, your employer must make up the difference to ensure you are paid at least $7.25 an hour. If your commission rate falls below minimum wage, you still are entitled to be paid minimum wage. You do not work for free if your commissions average less than minimum wage at times. If your employer does not make up the difference, you may be able to file a wage and hour claim.

My Employer Won’t Pay My Agreed-Upon Commission

While the FLSA does not require the payment of commissions, that doesn’t mean that you are out of luck. If you had a clear agreement regarding your commission pay, such as a contract, you can take action. First, you should draft a letter to your employer informing them that you are not receiving your promised commissions, as stated in your contract. Our employment law attorneys can help you write and send this notice. If this doesn’t remedy the situation, we can help you pursue your unpaid commissions in court.

Overtime Pay & Commissions

If you are a commissioned employee, and you work more than 40 hours in a period of 7 consecutive days, it is likely that you are entitled to receive overtime pay for your extra hours. Under the FLSA, all non-exempt employees should receive overtime pay for meeting the above requirements.

Exempt employees may include:

  • Executives
  • Specialized or creative professionals
  • Administrators
  • Outside salespersons (such as an independent contractor)
  • Those whose regular pay rate is more than 1.5 times the minimum wage
  • Those whose commissions are more than half their earnings

If none of the above situations apply to you, but you aren’t receiving overtime pay, you may be able to file an unpaid overtime pay claim. Discuss your case with our employment lawyers to learn more.

What Can I Do?

If you aren’t receiving the ages you are owed, whether it is an unpaid minimum wage or unpaid overtime wages, there are several legal options available to you. Our Memphis employment law attorneys can help you file a claim with the Tennessee Department of Labor and Workforce Development Division of Labor Standards. The Division can help you to resolve the issue with your employer. If they are unable to do so, however, they will refer you to court, so you can pursue a lawsuit against your employer.

With more than 100 years of collective experience, Donati Law, PLLC is dedicated to fighting for the rights of employees. We devote a large portion of our practice to assisting employees with their wage and hour violation claims, so we have the knowledge and proven skill to take on your case. Our Memphis employment law attorneys can help you gain justice and your rightful pay.

Discuss your case with our team today. Contact our firm by calling (901) 209-5500.

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