Sales Commission Rules in PA

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Latest post 01-31-2010 7:44 AM by PhillySalesman. 3 replies.
  • 01-29-2010 11:03 AM

    Sales Commission Rules in PA

    I have worked for my company for a number of years (going on 6) and throughout this time I have asked for and never received a detailed summary of my payable commissions. I receive an Excel Spreadsheet at the end of each month with a summary of payable commissions broken down by the inside sales person's code and the profit from payments received. What I don't get is what what customer project has been paid, how much was paid, the profit accrued from the payment, or anything of that nature. Why I am overly concerned about this is on my "aged receivable" report which shows what is still outstanding there have been some "$0" sales, which because the sale has been billed I can't see what the COST of the sale was, and often there is no product or service associated, just an ambiguous&nbsp... material" line item. I am concerned that the company has been "billing" miscellaneous materials against my commissions and I have no way of proving it without a detailed commission report. Is there a requirement for sales people to receive a detailed commission report?

    My second issue is even more gross and negligent&nbs... my eyes. With the down turn in the economy we have been, like everyone else, experiencing slower than normal payments from customers. We have an elevated scale of commission allowable based on the length of time the invoice is outstanding. i.e. if a payment is 90 days old I may be due 75% of the commission, but if the payment is 120 days old I may not be owed anything. This is based on the condition of all of my aged receivables and not normally an issue with me. Because of the slow down in payments my employer sent out a notice that now anything over 120 days, not only would we not be owed anything for the sale, but they would deduct the amount of the commission that would have been owed from current commissions. i.e. if a sale is $100k and the profit is $20k, then at 121 days $20k is removed from my current commission payment, which is based on the profit of sales. I have been told that this is illegal, but I can't find anything specific on it on the PA Department of Labor and Industry boards. Does anybody have any experience in this matter?

    Any response is appreciated!

  • 01-29-2010 1:26 PM In reply to

    • Drew
      Consumer
    • Top 10 Contributor
    • Joined on 03-30-2000
    • PA
    • Posts 48,912

    Re: Sales Commission Rules in PA

    Laymans take:

    Thats about as counterproductive a commission structure as I can imagine --but I can see a beancounters point--and it encourages you to go out on day 115 with a 300 lb friend with a bulge in his jacket  to "encourage " anybody who is slow to pay to pay up--I get the point!  And I've been places were similar games were played--but sometimes  it converted good sales people into lousy bill collectors with dubious  ability to make future sales to repeat clients. Different sets of skills!

    I actually know a small bank where if a teller takes in a bad check the teller goes out to collect on bad checks--but such stuff is rare

    No clue if its illegal--especially as to any future sales--you either agree or you can walk!

    I suspect management can get pretty creative to chargeback just about anything if its disclosed up front- sort of-- --and one local big chain with PA stores in effect charges back against a salesperson's  commission if they sell clearance merchandise (which sometime has a negative margin!)

    Manangement is free to play whatever game they think works--no matter how poor it turns out to be!

    ****

    What is probably true is that for INSIDE sales people a charge back scheme cannot  drive the persons salary below the prevailing minimum wage for PA .   That probably woud trigger a violation of PA law.



  • 01-29-2010 3:54 PM In reply to

    Re: Sales Commission Rules in PA

    OP, please tell me you're exempt under the Outside Sales classification.

  • 01-31-2010 7:44 AM In reply to

    Re: Sales Commission Rules in PA

    ?

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