Partially withheld commissions are now being withheld forever California California

[doctor]

My company employs various regional sales reps in multiple states across America but is based in Tennessee. Last year they changed our commission plan to one where they pay out the commission quarterly, but withheld 20% of the commission (from that quarter) that would then be paid when the fourth quarter commissions are paid (January) if certain targets or goals were met. Many reps are due somewhere between 10K and 20K, with some maybe even a little more. We were just recently told that the board (investors) decided they were not going to pay these commissions out due to the fact that we lost money last year and they don't want to pay out large commissions if it wasn't what they deemed a successful year. Our company has 4 divisions total and our division is the one carrying the other 3. Is this legal what they've done. The comp plan is in writing and the metrics have been clearly stated. Also, does it matter for this legal issue what state each of us is in, or do we revert to the company's home state (Tennessee)? What's the best way to pursue this if it's not legal and not put our jobs at risk

[DAW]

Wages of any type (including commissions) are subject to the laws of the state in which the work was done in. You mention CA in your title. If the work was indeed done in CA, then you need to download a copy of the CA-DLSE manual, and read the chapter on commissions. CA has some very specific rules on commissions that are not the same as other states. If the work was done in CA, and after reading those rules you feel you are owed money, file a wage claim with CA-DLSE. Word the claim in such a way that it is clear how your claim ties to the actual rules found in the CA-DLSE manual.
http://www.dir.ca.gov/dlse/Manual-Instructions.htm

If the work was done somewhere other then CA you need to post the state. There is no such thing as a "one size fits all states" answer with commissions.

[doctor]

Most of us cover 5-7 states, with my territory being the Westermost 7 states, but am home office based in California. Would we need to file claims in each state as we work (have customers) in each of these 7 states? or would a claim in california take care of them all? Thanks

[DAW]

No idea. States do not agree on much of anything. File the wage claim in CA. It works or it does not. And if CA-DLSE will hear the claim, CA arguably has the best rules from your standpoint.

Just a thought, but have you ever gotten a W-2? If so, what state(s) did you have your wages reported to? It is kind of hard for employers (or employees) to try to change states after the W2s and quarterly reports were filed. If your wages were reported to CA, then your employer is a weak position to claim that CA was not your state. Alternatively if your wages were not reported to CA and you went along with it, then you are in a weak decision to claim that all of sudden that CA is your state.