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.
Recently I have seen an increase in the number of current or former employees filing wage claims against their employers here in California. There often is a good reason for the filing. In my experience, employees typically do not spend time and effort on filing wage claims unless they have some basis for concluding they have been underpaid, such as:
- Unpaid wages, including commissions or bonuses.
- Accrued but unused vacation time not paid at the time of termination.
- Unauthorized deductions from paychecks.