Title: Commission exploit
I’m a commissioned sales rep in California. I earn a draw but in essence it’s commission only. Not long ago my company began using us to do work in another department. A department staffed by employees who are paid an hourly wage. Free labor scam?
Hi Krambo,
Thank you for your question. Am I correct in assuming you are a non-exempt employee? If so, then it is likely you are entitled to be compensated separately for time you spend on tasks that do not contribute to your commissions. That compensation must equal at least minimum wage.
For example, at least one California court has held that employers who pay employees solely on a commission basis must separately compensate them for time they spend on their rest breaks. (Vaquero v. Stoneledge Furniture, LLC (2017) 9 Cal.App.5th 98, 108.) The same would seem to be true for activities in other departments in which you are not able to directly earn commission wages. (See Balasanyan v. Nordstrom, Inc. (S.D.Cal. 2012) 913 F.Supp.2d 1001, 1007.)
Of course, I am not familiar with the details of your commission agreement, so it is possible my conclusion is wrong.
It is also worth noting that the law in this area is kind of in a state of flux. Recent court decisions are trending to requiring separate compensation for these tasks, but the issue has not been directly address by either the California Supreme Court or the legislature.
If you are interested in California law on exemptions, you can find that information here: Exempt vs. Non-Exempt Employees: Guide to California Law. You can also find out more about commission sales rules in our article: The Law on Commission-Based Pay for Sales Employees in California.
Whatever the case, I hope this information helps. Please remember that this information does not constitute legal advice and should not be relied on. Nor does it create an attorney-client relationship.
I wish you the best of luck in your situation!