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Commission Concerns

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  • Commission Concerns

    I recently started a new sales position. Our company runs on the FY so each year new compensation plans are rolled out for commissions. This new position I accepted offers a "Rookie" compensation because it typically takes a while to start making commissions. When I was hired, my offer letter stated,

    "This confirms our job offer for XXX. Your compensation is as follows:

    Base Biweekly Salary: XXXX
    Guaranteed Bonus XXXX biweekly for 26 pay periods
    Commissions: XX% on Core and X% on Lead. This commission structure remains in effect for the duration of your guaranteed bonus.

    Enclosed is a copy of your compensation plan. Please sign the plan and return to me, along with a signed copy of this offer letter."

    My rookie compensation for commission crossed fiscal years, and they changed the Rookie Pay for this FY to be less than the previous year that I was offered and guaranteed for a full year per my offer letter. They never asked me to sign the revised Rookie Pay guidelines for the new FY and my offer letter states that my pay would be set at the amount listed on the offer letter for 26 pay periods. They paid me in accordance with the offer letter. Now they are saying the made an error and they should be paying commissions at the new FY rate even though they never had me resign the new Rookie Plan and spelled out those commissions rates on my offer letter. My manager is stating that an offer letter is not a legally binding document, and she is being told to recoup the commissions. Obviously, they are trying to recover a lot of money in commission because the new Rookie commission structure is not as generous as the previous year. Are they legally allowed to recoup this money? What should I do? I'm very disappointed with the lack of professionalism, and I don't feel they're being fair based on the facts.

    Thank you.
    Last edited by concernedee; 11-12-2005, 11:14 AM.

  • #2
    The best thing at this point is to take all the documents to an attorney to see if they rise to the level of a contract and, if so, whether the company breached it.
    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.


    • #3

      What state do you work in?
      Last edited by CompensationCounsel; 12-13-2005, 08:38 AM.
      This post is by Philip Gordon, a Massachusetts employment attorney (

      This post is NOT legal advice. It is for general/educational information purposes only. You should not rely on this post if you are making decisions, and it does not create an attorney-client relationship. This post may be considered "advertising" under the MA professional rules for attorneys.


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