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Commissioned Salespeople & Overtime, Part 4: Final Words

By James Peters

Although this series on commissioned salespeople and overtime might not be the most exciting employment law topic, for those with large unpaid claims, it probably is the most exciting. I leave this topic with the following points.

Minimum Wage Test

The final test that must be met before commissioned salespeople can be considered “exempt” from overtime wages is the “minimum wage” test.

Each week a commissioned salesperson must make at least 1.5 times the California minimum wage. Otherwise, they are automatically considered non-exempt for that week.

For employees with low “base” pay or those who are paid 100% commission, this puts the unwelcome burden on employers of paying overtime to those salespeople who are not very good at their job and do not make any commissions for the week.

However, many employers simply pay a “base” rate of 1.5 times the minimum wage to stop this from happening in the first place.

Must Actually “Sell”

Some employees have “sales support” positions. They are the ones who actually install the product or provide technical support for the salespeople but do not actually “sell” to the customer.

This probably should just go without saying, but in order to be classified as “exempt” for being a commissioned salesperson, you actually have to be “selling” something.

Common Misclassifications in California

Some of the professions that are most often misclassified include the following groups:

• Financial Planners
• Stock Brokers
• Mortgage Brokers
• Other Financial Industry Salespeople
• Those who provide “sales support” but do not actually sell, and
• Commercial Equipment Salespeople

If you belong to one of these professions, you very well may have a large unpaid wages claim to pursue!

Commissions | Exemptions | Hourly | Minimum Wage | Overtime | Sales Employees | Wage and Hour

Related posts

• Q&A: Annual Bonus Not Necessarily Lost When Terminated
• Q&A: Lost Vacation Pay Is Recoverable
• "Side Effects" of California's Increased Minimum Wage
• Claims Adjusters and Others Likely Non-Exempt in California

Full post as published by California Employee Rights Blog on January 21, 2007 (boomark / email).