Your Right to Earned Commissions

If you are paid by commission, you may have a legal claim if your employer refuses to pay you a commission you have earned — even if you are laid off or fired. Your employment agreement may specify when a commission is considered “earned,” or, if it doesn’t, a commission will be considered “earned” in accordance with the usual arrangement between you and your employer.

Once a commission is “earned,” it is legally considered “wages” under New York’s Labor Law, and therefore only certain limited deductions from the commission are permitted. Your employer must pay you the wages you have earned, even if your employment is terminated. And if your employer fails to pay you your earned commissions, you could be entitled to additional compensation in the form of liquidated damages and attorneys’ fees.

If you work under a type of commission framework called a “draw,” in which you are periodically paid a set amount and then are later paid only those commissions you earn that exceed that amount, your employer may only require you to pay back the “draw” amount if your contract explicitly provides for this repayment.

If you believe your employer has wrongfully withheld your commission payments, contact us to speak with an experienced employment lawyer to see if you are entitled to compensation.