Compared to many states, California is home to decent labor laws—especially for most hourly workers. Both California law and the federal Fair Labor Standards Act (FLSA) cover protections for workers. If you are a salesperson who works outside the office or on commission, however, the law becomes a little more confusing. Here are answers to some common questions.
Can sales employees receive overtime pay?
Outside sales employees are considered exempt from overtime pay under the California law, but only under certain situations. The employee’s main job duty must be in sales, and they must spend the majority of their time away from the place of business. In addition, they must receive a certain minimum base salary.
Salespeople who make more than half their money on commission are exempt from overtime pay in most situations. However, their pay must already exceed one and a half times the minimum wage.
What is an outside salesperson?
An outside salesperson spends more than half their time off-site from the employer’s business to sell products, services, or facility use.
Does minimum wage apply to salespeople?
The same exemptions that cover overtime pay also apply to minimum wage. Although many salespeople are exempt from minimum hourly wages, they are guaranteed a minimum salary.
On January 1, 2020, California raised that salary minimum to:
- $54,080 per year if the employer has more than 25 employees; and
- $49,920 if they have 25 or fewer employees.
The formula is slightly different for commissioned salespeople, as indicated above.
What other protections do salespeople have?
A salesperson enjoys all the legal protections of other employees.
For example, they have:
- The right to receive payment on time for all their work;
- The right to a workplace free of discrimination; and
- The right to a safe workplace.
If you think your employer is not compensating you correctly or is violating any other labor laws, you may have legal recourse, but you will need support from an experienced legal professional.
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At Frontier Law Center, our attorneys use modernized legal strategies and cutting-edge case management software to deliver a revolutionary level of service for each client. Employment law is constantly changing, which is why you need a team that is ready to adapt to new challenges at every turn. If your employer has violated your rights, we can help you report these violations to the California Department of Industrial Relations and, if appropriate, bring a claim against your employer. No matter what you have experienced, you can count on our dedicated support.