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  • Commissions-base pay withheld Rhode Island

    Hello,

    My husband works for a national company (with stores in every state) for sales commission-based pay. Any time there is a problem with a job that the company choose to compensate the customer for, it is my husband's paycheck that is docked that amount...not the project manager's, contractor's, or regional management's pay, just the sales consultant's paycheck. If the customer decides they want more than their contract specifies but refuse to pay the difference, the difference is taken from my husband's pay. If a customer is unhappy at the end of the job regardless if everything was done perfect & the company chooses to give the customer a gift card to make them happy, it's automatically taken from my husband's pay and he doesn't have a say in the matter at all. In fact, if he complains he can get into trouble.

    Apparently this is nation-wide practice with many companies who's reps are paid commission-based. Is this really legal???

  • #2
    Does he do inside sales or outside sales?

    Does the commission agreement provide for any of these offsets? This is almost certainly a matter of contract law, not a matter of wage and hour law (unless he's inside sales, then we have more to discuss).
    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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    • #3
      Originally posted by Pattymd View Post
      Does he do inside sales or outside sales?

      Does the commission agreement provide for any of these offsets? This is almost certainly a matter of contract law, not a matter of wage and hour law (unless he's inside sales, then we have more to discuss).
      thank you for your response.

      Hubby has been told his contract with the company pays him commission on the final sale...which is the sale of the project minus any difference the project manager feels the customer was not charged for or compensation the company decides to placate the customer with. Hubby is not allowed to argue & gets in trouble if he tries. The company suffers no loss whatsoever in profits...it does not come out of their bottom line, it comes out of my husband's paycheck. (And other reps just like him & there's hundreds in the country.) I'm not sure what you mean by inside vs. outside sales. Hubby goes to people's homes to help them w/ their projects. He "brings the store to them", he represents the store.

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      • #4
        OK, so he sounds like outside sales, and the FLSA provides that such salespersons are exempt from not only the minimum wage and overtime provisions of the the law, but also the "salary basis" provision for exempt employees. So, legally, he can be paid ONLY commissions. This basically takes wage and hour law out of the equation and it becomes a matter of contract law.
        I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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