Legal Question in Employment Law in California

My wife has been working under a "verbal" agreement for the last year. She wrote and agreement and gave it to her company which was never executed - but was followed in daily business operations by the company. She was paid a commission of 20% of the gross revenue when received by the company and was non-refundable to the paying party. The paying party makes two payments to the company, 50% of a contract vale at signing and 50% upon the use of a facility as an event venue. My wife was receiving 20% of the 50% when collected on contract signing and the remaining 20% of the second 50% upon full payment for the event.

The company now wants to pay her only upon the final contract payment in full - not upon the receipt of non-refundable payments as they have been using for operations for the last year. The company is afraid that if the company has to cancel an event, the company will have to refund the payment Any decision to cancel an event will be the company's decision and not my wife's. Can she force the company to continue there procedure which has been in force for over a year? Also, the cash generated from the first 50% payment on all contracts is being used as operating capital for the company. The company is paying other operating expenses from the received non-refundable cash, such as utilities, landscaping, legal, bookkeeping, etc.


Asked on 3/18/14, 10:48 am

1 Answer from Attorneys

Unless the change in compensation would place her under minimum wage, or unless there is a contract that is agreed to remain in force for a specified period of time, the employee is "at will" and the employer can change the term and conditions of employment at any time, or simply fire the employee if they don't like it. The only thing they cannot do is change the payment rules for pay that has already been earned.

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Answered on 3/18/14, 11:24 am


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