Effective January 1, 2013, every employee in California who is compensated, entirely or partially, by commission must have a written employment contract that states the method by which commissions will be computed and paid.
By January 1, 2013, whenever an employer enters into a contract of employment with an employee for services to be rendered within this state and the contemplated method of payment of the employee involves commissions, the contract shall be in writing and shall set forth the method by which the commissions shall be computed and paid.
Section 2571(b) goes on to state that the employer must give a copy of the contract to the employee and must obtain a signed receipt for the contract from the employee.
Commissions are defined, generally, as “compensation paid to any person for services rendered in the sale of such employer’s property or services and based proportionately upon the amount or value thereof”.
Dana H. Shultz, Attorney at Law? +1 510 547-0545? dana [at] danashultz [dot] com
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