Unpaid Commission & Bonus Lawyer in California

Not every paycheck problem looks like a missed hourly wage. If your employer promised you a commission or bonus and then didn't pay it — or changed the rules after you'd already earned it — California law may treat that unpaid commission the same as any other unpaid wage, with real penalties attached.

Are Commissions and Bonuses Considered Wages in California?

Yes, in most cases. Under California law, a commission is a form of wage paid as a percentage of the value of a sale or order, and once it's earned according to the terms of the agreement, it's treated like any other wage an employer owes. Discretionary bonuses (true, unpromised gifts at the employer's sole discretion) are treated differently, but many "bonuses" are actually non-discretionary — tied to sales targets, performance metrics, or company policy — which makes them enforceable wages, not favors.

The key legal question is almost always the same: when was the commission or bonus actually earned, according to the written or oral agreement between you and your employer?

Common Ways Employers Shortchange Commission and Bonus Pay

• Changing the commission plan retroactively after work is done but before the commission is paid out.
• Firing or laying off an employee right before a commission would vest, to avoid paying it.
• Withholding commissions on the theory that a sale "wasn't final" long after the customer paid and the deal closed.
• Failing to provide a written commission agreement at all, as required for most commissioned employees under California law.
• Deducting business losses, chargebacks, or customer returns from earned commissions in ways the agreement doesn't actually authorize.
• Classifying non-discretionary bonuses as "discretionary" to avoid paying them out or including them in overtime calculations.

California's Written Commission Agreement Law

California Labor Code section 2751 requires that when an employee's compensation involves commissions, the contract must be in writing and must set out the method by which commissions are computed and paid. If your employer never gave you a written agreement, that alone can be a violation — and it also makes it harder for the employer to argue after the fact that a commission wasn't actually earned. Ambiguities in an unwritten or poorly drafted commission plan are generally interpreted in the employee's favor.

What Happens When You're Fired or You Quit With Commissions Still Owed

Timing questions come up constantly in commission disputes, especially around terminations and layoffs. California generally requires that earned, calculable commissions be paid according to the same final-pay rules that apply to regular wages:

1. If you're terminated or laid off, all wages, including earned commissions that can be calculated at the time of separation, are generally due immediately.
2. If you quit with at least 72 hours' notice, final wages are generally due on your last day.
3. If you quit without notice, your employer generally has 72 hours to pay you.
4. Employers who willfully fail to pay earned wages on time can face waiting time penalties under Labor Code section 203 — up to 30 additional days of wages.

A commission that hasn't yet been calculated because the final sale figures aren't in yet is treated a little differently, but employers cannot simply delay indefinitely or use the calculation process as an excuse to withhold pay altogether.

How to Prove You're Owed Unpaid Commissions or Bonuses

Commission disputes often turn into a battle over paperwork, so documentation matters enormously. Useful evidence includes:

• Any written commission plan, offer letter, or bonus policy, even if it was only sent by email.
• Pay stubs and commission statements showing prior payment history and how commissions were previously calculated.
• Sales records, CRM data, or signed contracts showing when a deal actually closed.
• Emails or texts discussing commission terms, promises, or disputes.
• Witness accounts from coworkers paid under the same plan.

What Compensation Can You Recover?

Every case depends on its own facts, and no attorney can promise a specific number before reviewing the details, but California law generally allows employees to pursue:

• The full amount of the unpaid commission or bonus actually earned.
• Waiting time penalties if final wages, including commissions, weren't paid on time after separation.
• Interest on unpaid wages.
• Attorney's fees and costs in many successful wage claims.

If your commission dispute is tied to being fired outright for complaining about it, that may also raise a workplace retaliation claim worth discussing with an attorney separately.

Deadlines for Filing an Unpaid Commission Claim

Claims for unpaid wages, including commissions, generally must be filed within three years of the violation under California's statute of limitations for wage claims, and in some cases a four-year period applies if the claim is also brought as a breach of a written contract. Waiting too long can mean losing access to some of the earlier unpaid amounts, so it's worth getting an evaluation sooner rather than later. You can review general wage claim guidance through the California Labor Commissioner's Office at dir.ca.gov.

Steps to Take If You're Owed Commissions or a Bonus

1. Request your commission agreement and pay records in writing, and keep a copy of the request.
2. Calculate what you believe you're owed, using your own sales or performance records as a backup.
3. Don't sign a release or separation agreement that waives wage claims without having it reviewed first.
4. File a wage claim with the California Labor Commissioner's Office, or consult an attorney about filing directly in court, depending on the size and complexity of the claim.
5. Act promptly — memories fade, records get purged, and deadlines keep moving.

Frequently Asked Questions

Is an employer allowed to withhold a commission after I'm fired?

Not if the commission was already earned under the terms of your commission agreement. California treats earned commissions as wages, and employers generally cannot withhold them simply because employment has ended.

What's the difference between a bonus and a commission under California law?

A commission is typically tied to a percentage of a sale, while a bonus can be either discretionary (a true, unpromised gift the employer isn't required to pay) or non-discretionary (tied to specific, promised metrics). Non-discretionary bonuses are generally treated as earned wages once the conditions are met.

Can my employer change the commission plan after I've already made a sale?

Generally, no — at least not retroactively for sales made under the old plan. Employers can typically change commission terms going forward, but changing the rules after the work was already done to avoid paying what was promised can support a wage claim.

How long do I have to file a claim for unpaid commissions in California?

In most cases, you have three years from the date of the violation to file a wage claim, though claims framed as breach of a written contract may have up to four years. Because deadlines and cutoffs can be fact-specific, it's best to consult an attorney promptly.

Do I need a written agreement to have a valid commission claim?

No. Even without a formal written agreement, you may still have a valid claim based on emails, company policy, past practice, or verbal promises — although California law requires employers to put commission terms in writing, and their failure to do so can work in your favor.

If you believe you're owed unpaid commissions, bonuses, or other wages in California, you don't have to take your employer's word for what you're owed. Mihran M. Ghazaryan and the team at MMG Law Firm offer a free, no-obligation consultation, and employment wage cases are handled so you pay nothing unless we recover for you. Contact us to go over what happened and find out what your options are.