Georgia Commission Disputes
Atlanta Pay Dispute Attorney
Commissioned salespeople, manufacturer's reps, managers, executives and other employees often earn money that is payable to them in the form of bonuses, commissions and other incentives that are paid at a later date. Many times, the company does not pay the full amount owed, or the employee is fired and the company refuses to pay any of the money that is owed. This tactic is common with account executives or salespeople who quit or are fired and then the company refuses to pay commissions or bonuses that were fully earned but not paid before termination of employment. Other times, the company is willing to pay these monies but insists on the employee signing a broad release as a condition for the payment of the money owed to the former employee. Still other times, the employers takes the position that they will not pay the monies owed unless the terminated employee signs a severance agreement which includes a non-compete clause and/or a non-solicitation clause which affects the employee's right to work and compete. We have litigated cases involving these legal issues with small local companies and large multi-national companies alike. Many of these tactics are unlawful under Georgia law. Often, the only recourse if you want to get paid is to hire an attorney who knows the laws in Georgia as they apply to earned but unpaid commissions and other monies owed and sue the company for your money.
Under Georgia law, in the absence of an employment contract or specific law providing protection, the employer-employee relationship is considered "at-will" and can be terminated at any time and for any lawful reason by the employer or employee. Many employment relationships in Georgia are governed by the employee handbook, commission schedule or similar posted personnel policy. While these agreements are not labeled "Employment Contract," they are sometimes treated as such by Georgia courts in employment-related lawsuits. In addition to the enforcement of these agreements, many terminated employees can sometimes sue and collect damages under a "quantum meruit" theory of recovery. Regardless of the cause of action, unless there is a legally enforceable agreement otherwise, employees are legally entitled to all of the money that they have earned and which is owed such as earned commissions, accrued sick days, accrued vacation days, paid holidays and accrued retirement benefits.
An employee who leaves a company may be able to recover lost wages, pre-judgment interest, lost profits, and any other damages that were reasonably contemplated by the parties at the time of the breach. One of the most common examples involves commissioned salespeople who have made sales which resulted in large commissions that are earned but not paid prior to termination. If the employee is terminated prior to the commission being paid, many times the employer tries to avoid paying the commission and cites the "at-will" doctrine in a misguided attempt to avoid paying the commissions. In actuality, the "at-will" doctrine provides little protection to an employer who tries to avoid paying commissions that have been fully earned and payable to the employee prior to termination.
Absent an enforceable agreement otherwise, commissioned employees who have made sales and have fully earned commissions must be paid pursuant to Georgia law, whether or not the employee is still working for the company. If not, the employee has the right to file suit and sue for the commissions owed. In some limited cases, a terminated Georgia sales representative of an out of state principal who fails to make timely payment of commissions owed may sue for the commissions actually owed, plus exemplary damages in the amount of twice the commissions owed, plus attorneys' fees incurred in pursuing the commissions.
O.C.G.A. 10-1-702 provides in pertinent part:
- When a contract between a principal and a sales representative is terminated, the principal shall within 30 days after the termination of the contract pay all commission due to the sales representative.
- A principal who fails to make timely payments of commissions as required  shall be liable to the sales representative in a civil action for:
- All amounts due to the sales representative according to the terms of the contract;
- Exemplary damages in an amount not to exceed double the amount not timely paid as required by [this code]; and
- Reasonable attorneys' fees actually and reasonably incurred by the sales representative in the action.
Commission disputes are highly fact-specific and depend a lot on the agreement under which the company and the commissioned employee were operating under as well as the facts of the case. In other words, while the general laws are important, each case is different and the details of the case are ultimately determine which laws apply and the strength of the claims.
Robert J. Fleming is an experienced Atlanta business trial lawyer. In addition to a law degree, Mr. Fleming has earned an MBA in finance, has acted as outside general counsel to a number of businesses, and has successfully handled a number of business pay disputes throughout the litigation process. Having successfully worked as an Account Executive for a Fortune 50 company prior to law school, Mr. Fleming's unique set of experiences and skills allows him to help workers in this situation by enforcing valid agreements for payment.
If you have a pay dispute or have not been fully paid for commissions that you have earned and would like to discuss your case, please call Robert J. Fleming directly at (404) 525-5150 or contact us online. We are here to help.