Written Commission Plans
Required of all CA Employers as of 01/01/13
What is Required?
AB 1396, effective January 1, 2013, requires all employers doing business in California to draft written contracts for any agreements with employees that involve commissions as a method of payment for services.
The new law requires employers who pay employees via commission to:
(1) have a written contract with the employee regarding commissions
(2) include the method for calculating the commissions
(3) require the employee to sign a "receipt" retained by the employer.
Also, the contract remains in effect until a new commission plan has superseded it or employment terminates, even if the old plan expires.
The law excludes bonuses, except if the bonus is a percentage of sales or profits.
Your Written Commission Plan Includes:
- On-Site discussion of current or proposed plan (up to 2 Hours)
- Development of a Written Plan
- 2 Editing Sessions to Finalize the Plan (Up to 3 hours, via conference call)
- 1 Management Training Session and/or Employee Meeting to announce and sign-off on the Plan