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ARTICLE · 06 DECEMBER 2020

Think Your Commission-only Plan Is Good?

Constangy, Brooks, Smith & Prophete, LLP
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Two of the more complicated areas of California wage-and-hour law involve commission plans and overtime exemptions. Commission plans are complex animals – long gone are the days where Joey gets ...

United StatesEmployment and HR
Jasmine Anderson
Jasmine Anderson

Think again.

Two of the more complicated areas of California wage-and-hour law involve commission plans and overtime exemptions. Commission plans are complex animals – long gone are the days where Joey gets 5 cents for each widget he sells and we call it a day. Overtime exemptions are likewise fraught with landmines, and many a California employer becomes ensnared in the overlapping rules of the Wage Orders, court decisions, and guidance from the Division of Labor Standards Enforcement and Department of Labor. 

For those of you who say "bring it on," Christmas came early with the Fourth Appellate District's decision in Semprini v. Wedbush Securities, Inc., in which the court analyzed whether an employee who was paid 100 percent on commission was properly classified as "exempt" under the administrative exemption established in Industrial Welfare Commission Wage Order 4. 

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