Legal Question in Employment Law in California

To be legally recognized as an exempt outside salesperson, the employee must be spending more than half their time selling a product or service and the amount of the employee's compensation must be a percent of the price of that product or service. Each week, the average hourly earnings must be at least $12.00 per hour and at least half the earnings must come from commissions. (See Ramirez v. Yosemite Water Co. 20 Cal. 4th 785).

Commissions are payable when earned. This is typically determined by a commission agreement which will state when the commission was earned, i.e. when the order was placed, when the customer paid for the order or some other contingency. Some agreements may state the employee must be employed at the time of the contingency, in order to be paid.

If you believe you have been misclassified or wrongfully denied commissions, you should consult with an employment law attorney in your area for a more informed legal opinion and to discuss your legal options.