Taking away commission once paid
Discussion
I'm signed in under another username to protect identity, but wanted to run something past you.
Over the last few months, I've started getting paid commission on sales that I have been part of (as an account manager, NOT a salesman). It is not a lot, but is very welcome.
A "get out" clause was put in a contract for one customer, which after 3 months they have decided to use. The reason for this had nothing to do with my work on the account, it was a product issue.
This month I have been told my pay will be docked the commission that I was given for that client because they have cancelled after 3 months.
The question is...can my company do this?
It feels very unfair to me that I have done all I can for the customer, however an external issue has forced them cancel after 3 months, but I am now having money taken away from me because of it.
Am I right to be annoyed?
Over the last few months, I've started getting paid commission on sales that I have been part of (as an account manager, NOT a salesman). It is not a lot, but is very welcome.
A "get out" clause was put in a contract for one customer, which after 3 months they have decided to use. The reason for this had nothing to do with my work on the account, it was a product issue.
This month I have been told my pay will be docked the commission that I was given for that client because they have cancelled after 3 months.
The question is...can my company do this?
It feels very unfair to me that I have done all I can for the customer, however an external issue has forced them cancel after 3 months, but I am now having money taken away from me because of it.
Am I right to be annoyed?
I have no idea how that would work out now. Sorry.
Personally, I would be happy to receive commission for whatever items/service were sold/delivered in the three months, and no more commission after.
While, I would be annoyed, I would also feel it would be fair to return all commission received if it meant that the customer had not handed over any money to your company. But I can also see that it is not fair on you to now have to hand back money that you may have already spent - when not expecting to do so.
If I was in charge of paying you, and you were expected to receive more commission in the coming months, I would dock it off the incoming commission rather than actual pay, unless the sum of money involved is quite large.
Again, this is just how feel the situation may be best resolved without too much ill will on either side and my opinion is not legal advice in any way.
Personally, I would be happy to receive commission for whatever items/service were sold/delivered in the three months, and no more commission after.
While, I would be annoyed, I would also feel it would be fair to return all commission received if it meant that the customer had not handed over any money to your company. But I can also see that it is not fair on you to now have to hand back money that you may have already spent - when not expecting to do so.
If I was in charge of paying you, and you were expected to receive more commission in the coming months, I would dock it off the incoming commission rather than actual pay, unless the sum of money involved is quite large.
Again, this is just how feel the situation may be best resolved without too much ill will on either side and my opinion is not legal advice in any way.
happens in my company too, called commission clawback, if a deal i signed up goes awol or does not pay and we send them to dca then it can be claimed back from you.
on the plus side we do get the commission up front and in full, rather than a percentage each month over the term of the agreeement.
on the plus side we do get the commission up front and in full, rather than a percentage each month over the term of the agreeement.
prettypenny said:
(as an account manager, NOT a salesman).
Every employee should be a salesperson.Generally commission is only paid once the customer had paid the invoice. If it gets cancelled and the customer is credited then the commission is taken back.
Sounds like that happened to you, or you were paid commission in anticipation of business that never materialised?
amir_j said:
caymanjames said:
called commission clawback
I've worked with Insurance and finance companies who both did it if the deal fell through later down the line. Ditto our company.Whilst I don't work in sales, I deal with sales' commission and it always seems to kick off when something like this happens.
Devils advocate (maybe a bit blunt too - sorry) would say the company has had no benefit, why should you be rewarded for this?
I know it's not your fault, or any reflection on your performance, but still...
prettypenny said:
I'm signed in under another username to protect identity, but wanted to run something past you.
Over the last few months, I've started getting paid commission on sales that I have been part of (as an account manager, NOT a salesman). It is not a lot, but is very welcome.
A "get out" clause was put in a contract for one customer, which after 3 months they have decided to use. The reason for this had nothing to do with my work on the account, it was a product issue.
This month I have been told my pay will be docked the commission that I was given for that client because they have cancelled after 3 months.
The question is...can my company do this?
It feels very unfair to me that I have done all I can for the customer, however an external issue has forced them cancel after 3 months, but I am now having money taken away from me because of it.
Am I right to be annoyed?
I think the most important lesson here is not spend the commission until three months have passed. This means you will not lose out and it will allow you to budget effectively with money you rightly have to spendOver the last few months, I've started getting paid commission on sales that I have been part of (as an account manager, NOT a salesman). It is not a lot, but is very welcome.
A "get out" clause was put in a contract for one customer, which after 3 months they have decided to use. The reason for this had nothing to do with my work on the account, it was a product issue.
This month I have been told my pay will be docked the commission that I was given for that client because they have cancelled after 3 months.
The question is...can my company do this?
It feels very unfair to me that I have done all I can for the customer, however an external issue has forced them cancel after 3 months, but I am now having money taken away from me because of it.
Am I right to be annoyed?
FamilyDub said:
amir_j said:
caymanjames said:
called commission clawback
I've worked with Insurance and finance companies who both did it if the deal fell through later down the line. Ditto our company.Whilst I don't work in sales, I deal with sales' commission and it always seems to kick off when something like this happens.
Devils advocate (maybe a bit blunt too - sorry) would say the company has had no benefit, why should you be rewarded for this?
I know it's not your fault, or any reflection on your performance, but still...
The important thing was that in both cases I made sure the 'rules' were clear. When my team were told of the change it was clear it was essentially an idea to pay us less, from one director looking for cost savings. As such it was seen a pay cut (for being successful!) and it would damage the motivation of the team.
We eventually settled on a mechanism which the team were happy with (an increased commission rate and a transitional period) that both aligned them more closely with the company’s objectives, and retained take home commission levels.
If you are not moving from a ‘defined’ structure you will find such a case harder to make I’d guess and so perhaps you'll have to accept it and ensure these things are clearer in future. I’m also not arguing that in this case scheme A is ‘better’ or ‘fairer’ than scheme B. However when staff have been working on ‘A’ for a while there is a reasonable expectation they will be informed of any move to ‘B’ in advance.
In my current job I get commission on large orders.
Earlier this year I secured and order from a customer that was worth £500k+ to the company meaning I got 0.5% in commission.
It just so happened that 6 months down the line the customer went bust so the order never went through.
My company would not ask me for the commission back as it was not my fault.
On the other hand, when I first started working I worked in phone sales on the high street which was mostly commission based. You would be payed commission in same month as the sale, but if the customer cancelled their contract, the money would be deducted from my next paycheck.
It was on a much smaller scale though
Earlier this year I secured and order from a customer that was worth £500k+ to the company meaning I got 0.5% in commission.
It just so happened that 6 months down the line the customer went bust so the order never went through.
My company would not ask me for the commission back as it was not my fault.
On the other hand, when I first started working I worked in phone sales on the high street which was mostly commission based. You would be payed commission in same month as the sale, but if the customer cancelled their contract, the money would be deducted from my next paycheck.
It was on a much smaller scale though
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