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View Full Version : commission pay & holiday and overtime Mississippi


Emeralddawnn
11-21-2007, 04:22 PM
My husband currently works for a company on a salaried scale with commission based upon his sales. He gets a percentage of the commission and that couples with the weekly pay he gets to get his paycheck. He is paid $425 a week plus 5% commission after $5,000 in sales or $500 set wage if commission does not exceed $500 paycheck. Confusing, I know but most of the time he is paid $425 a week plus the commission because commission runs nearly $200 or more after the 5% comes out.
This company has many routemen and more than 10 employees working for it.

We are beginning to notice a few things that we had not noticed before.

He has always worked 12 plus hour days with no more compensation. He never takes a break unless he is driving the truck to another stop...His route has a lot of drive time....that his break (he tells me.) He never gets overtime and he never gets comp time. Is this actually legal? (Some days.. he works close to 14 hours, depending on stops and other things.) Please explain to me in layman's terms because I've tried reading exempt and non-exempt and I dont really know where he would actually fall. Can he get overtime for working so many hours in one week.. (50 to 60 hours a week)

Second... and more importantly, some of his stops are open on legal holidays.. ie... thanksgiving, christmas and new years' eve. Whether he works the holday or not, he is paid a set amount....typically much less than his commission brings in. However, there is no commission pay for the week. Is the company allowed to withhold commission pay just because it's a holiday? (His commission is always more than what he gets from the holiday pay. So when he gets his paycheck two weeks later, it's always far less than what he would have with the commission.

Also, the company allows only one personal day off a year despite people getting sick more than that ofcourse. What does the law allow for personal days or is it by a company by company basis? There is no substiution for vacation for a sickness even if the person has the time.

It would be great to know because I've tried looking it up with no such luck. I'd like to know if the company is doing something illegal by doing these things and try to remedy the situation. Thank you!

DAW
11-21-2007, 06:14 PM
This is potentially complicated. I am going to need to ask some questions.
- Just to be sure, is your husband legally an employee? Are taxes withheld from the paycheck and is a W2 issued at year end? If this sounds obvious, legally it might not be.
- There is a federal law called FLSA which is sort of the cornerstone law related to this type of labor law. While this law generally affects all employees and employers, this is not always true. We need to check this point next. Does the employer have at least $500K in annual sales OR does the employer engage in interstate commerce? If either of this things is true, then the FLSA law is almost certainly applicable.
- What line of work is the employer in (we do not want to know the name of the company)?. Also, based on what you have said I am sort of visualizing say a food truck driven by your husband where he stops by regular customers on his route and the customer basically decides what they want. Is this basically correct?

Depending on what your answers are, there is a pretty good chance that I am going to ask you to look at the Exempt - Outside Sales exception. I am going to include a pointer to that now.

http://www.dol.gov/esa/regs/compliance/whd/fairpay/fs17f_outsidesales.htm

ScottB
11-21-2007, 07:38 PM
the company allows only one personal day off a year despite people getting sick more than that ofcourse. What does the law allow for personal days or is it by a company by company basis? There is no substiution for vacation for a sickness even if the person has the time.

Companies are not required to provide personal days, sick days or vacation days. If they provide vacation leave, they are pretty much allowed to dictate when it can be paid. It is not unusual for a company to insist that vacation be scheduled in advance which is not what happens with sick leave (aside from scheduled surgery or the like).

What the company is doing in that regard does not look illegal.

There are rules about route drivers (DAW's link might show those, I am not sure) and your husband MAY be exempt from overtime.

I am confused about the holiday issue.

Emeralddawnn
11-21-2007, 09:18 PM
DAW...

Yes my husband gets a W2 and taxes are withheld each week.
As for what he does, you are somewhat correct. He is a vendor. He stocks cold food machines with sandwiches and other items and also the drink machines ie.. Pepsi and Coca-Cola. As for what he does, the company is contracted into the place of business (stops along the hubby's route). They set up what items are to go in the machines based on previous sales or what the customer wants. My husband is only in charge of delivering said food and filling out the orders for the next week's shipments.
Based on the conclusion of my hubby's route in how much it brings in... I would say the company is close to $500K if not more than.. but Im not too sure on that. However, I do know that the business is only located in my part of Miss and nowhere else though they do travel extinsively around the state and not outside of it.. just yet!
We arent so worried about the overtime.. sucks as it may... he and the others should be entitled to it especially working them long hours.. it's the holiday and commission issue nagging at us. Everything else pales in comparison.
Please help!

DAW
11-22-2007, 07:31 AM
This is unfortunately outside of my hard area of expertise. Employers I have worked for were either manufacturing or software, and this is not an area that I have ever hard researched. Maybe someone else on the list is more knowledgable in this area. Also Mississippi is not my state and I have no idea what their laws are.
- I cannot tell if FLSA is applicable or not. If not, then your state's laws are applicable.
- I am not sure if the Outside Sales exception is applicable or not. The payment pattern you describe is strange but probably legal if the Outside Sales exception is applicable. If not, then minimum wage and overtime rules would apply (again assuming that FLSA is applicable - otherwise we are back at your state's laws again).
- There is a specific federal regulation that apparently determines whether or not Drivers who sell are subject to the Outside Sales exception (again assuming that FLSA is applicable). You need to read the entire regulation yourself, but I would say "no" based on the following:
http://www.dol.gov/dol/allcfr/esa/title_29/Part_541/29CFR541.504.htm

(d) Drivers who generally would not qualify as exempt outside sales
employees include:
(1) A route driver whose primary duty is to transport products sold
by the employer through vending machines and to keep such machines
stocked, in good operating condition, and in good locations.

You might try giving your state's Department of Labor a call (assuming that they have one).

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