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Employees Paid By Commission

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  • Employees Paid By Commission

    I wanted to inquire about any law or regulation that addressess the following problem in California:

    Can an employer by law, require employees that are paid by strictly by commission be available for 5hrs/day without paying them minimum wage?

    Would this requirement then incur "on-call" or "standby time" compensation? (Armour & Co. v.Wantock (1944) 323 U.S. 126)

    Where can I find information regarding this issue? Any response will be appreciated.

    Thank you in advance.


    UCRGIRL
    Last edited by UCRGIRL; 09-13-2005, 03:35 PM. Reason: Left out location

  • #2
    Can an employer by law, require employees that are paid by strictly by commission be available for 5hrs/day without paying them minimum wage?

    Depends on what you mean by "available" and what you mean by "strictly commission"

    Generally, the only types of sales jobs that can be 100% conmission with absolutely no draw...as in, whether it takes you two minutes or two months you don't see a single penny until your deal is closed...are outside salespeople. These are people like...real estate agents, telecom sales positions...people that are generally outside pounding the pavement, knocking on doors.

    CA law says that an outside salesperson cannot spend a significant amount of time doing the work of a non-exempt employee.

    As 5 hours/day is more than half of the business day, this is a significant amount and such a person does not meet the legal definition of an outside salesperson. Therefore, the employee must at minimum be paid a draw equivalent to the minimum wage for all hours worked....past and present.

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