Are Commissions Considered Wages Under the Massachusetts Wage Act?
Understanding When Commissions Are 'Due and Payable' Under the Massachusetts Wage Act
The Massachusetts Wage Act states that it is applicable to commissions that are "definitely determinable" and "due and payable."
What that means is that commissions are wages, subject to the protection of the Wage Act, including protections with respect to timely payment as well as payment on separation from employment.
It also means that there is considerable room for debate in specific situations, especially at termination, about whether commissions are "due and payable." This is because commission plans can vary. Some state that commissions are earned at the time a sale is made, regardless of when the product or service is provided or when the customer pays. Others condition the earning of commission on invoicing, shipment, or payment. Still others divide commission payments, with a certain amount earned at the sale and the remainder at the happening of some other event.
If your employer does not have a written commission policy, the default under the law is that commissions are earned when the sale is made.
Learn more here about commission pay under the Massachusetts Wage Act.
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