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When is a Commission Considered "Earned" Under the Wage and Hour Laws?

It is fairly easy to tell when wages or salary are "earned" for purposes of the Wage Act, based simply on time worked during a pay period.  It can get more complicated to know when commissions are earned.

First, an employer can establish by policy when commissions are considered earned.  A policy might say they are earned when the order is placed, or when the product is delivered, or when the customer is invoiced, or even not until full payment is received.  If there is a written policy, this definition of "earned" will control.

If there is no written policy, the Attorney General has opined that the default position should be that commissions are earned when the customer agrees to purchase the product or service, even if there is a time delay in deliver, invoicing, or payment.  

It is particularly important to know when the obligation to pay is triggered in the context of termination of employment.  Many employers will say that you need to still be employed at the time of commission payout to receive commissions- the reality is that if you have earned those commissions before termination, even if they have not yet been paid, you should be entitled to them.


Learn more here about commission pay under the Massachusetts Wage Act.

Need Help With a Commission Payment Issue?

Call (781) 784-2322
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  • Home
  • Employment Law
    • Guide To Employment Law Content
    • Advice for Employers
    • Employment Contracts in Massachusetts
    • Discrimination in the Workplace
    • Employment Termination >
      • Massachusetts Paid Family Leave
      • Severance Pay
      • Unemployment in Massachusetts
      • Should I Accept a Severance?
    • Sexual Harassment at Work >
      • Sexual Harassment in a Small Business
      • Sexual Harassment and Non Disclosure Agreements
      • Sexual Harassment and Remote Work
    • Wage and Hour Laws >
      • Overtime Law >
        • Overtime Exemptions
        • Employee Travel Time
        • Federal or State Overtime Law
      • Massachusetts Wage Act >
        • Payment of Commissions
        • Wage Deductions
        • Late Payment of Wages
        • Paid Time Off
    • Independent Contractor Law >
      • Independent Contractor Test
      • Working As Independent Contractor
      • Hiring Independent Contractors in Massachusetts
      • Is My Independent Contractor Status Legal?
    • Non Compete Agreements >
      • Are non competes enforceable
      • Massachusetts Non Compete Act
      • Pre 2018 Massachusetts Non Competes
      • Can I Avoid My Non Compete?
    • Do I Have a Case?
  • Estate Planning
    • Guide To Estate Planning Content
    • Legacy Protection
    • Why You Need an Estate Plan
    • Why You Don't Have an Estate Plan
    • Estate Planning Documents >
      • Children with Special Needs
    • Planning for Assisted Living
    • Probate Process
  • Business Law
    • Guide To Business Law Content
    • Small Business Law
    • Business Contract Basics
    • Civil Suit Defense
    • Legal Issues for Start Ups
    • Trademark Basics
    • How to Incorporate
    • Sale of Business
  • About
    • Reviews
    • Slnlaw Offices
    • slnlaw core values
    • Publications and Interviews
    • New Client Intake and Consultation
    • Contact
  • Attorneys
    • Emily Smith-Lee >
      • 2018 Lawyer of the Year
    • Jenna Ordway
    • Rebecca Rogers
    • Sharleen Tinnin
    • Elijah Bresley
  • Legal FAQs
    • Estate Planning FAQs
    • Probate FAQs
    • Small Business FAQs
    • Wage Act FAQs
    • Commission Pay FAQs
    • Overtime FAQs
    • Independent Contractor FAQs
    • Non Compete FAQs
    • Employment Discrimination FAQs
    • Employment Termination FAQs
    • Massachusettts Unemployment FAQs
    • Severance Package FAQs
    • Medical Leave FAQs
    • Sexual Harassment FAQs
    • Employer FAQs
    • Civil Lawsuit FAQs
  • Blog