News & Analysis as of

Sales Commissions

Directors disqualified for breach of competition law

by Hogan Lovells on

For only the second time in its history, the Competition and Markets Authority (CMA) has secured the disqualification of directors whose companies have infringed competition law. ...more

Auto Dealership Sells Supreme Court on Service Advisor OT Exemption

On Monday, the U.S. Supreme Court ruled that service advisers at car dealerships are exempt from the Fair Labor Standards Act (FLSA). In Encino Motorcars v. Navarro, the majority, Chief Justice John Roberts and Justices...more

FLSA Overtime Exemptions: SCOTUS Takes Its Thumb Off The Scales Of Justice

When it comes to exemptions from overtime under the Fair Labor Standards Act, courts have traditionally plopped a big thumb on the scale against employers: the exemptions have been construed “narrowly” in favor of a right to...more

U.S. Supreme Court Restores Status Quo For Automobile Service Advisors

by Tonkon Torp LLP on

On April 2, 2018, the United States Supreme Court, in a 5-4 decision, resolved a circuit split by concluding that auto dealership service advisors are exempt from the overtime requirements under the federal Fair Labor...more

Vehicle Dealers Service Advisors Are Exempt From Overtime

by Akerman LLP on

Vehicle dealerships may have a bit more flexibility in determining which employees are exempt from overtime following a U.S. Supreme Court ruling issued this week that specifically rejected the decades-old principle that...more

Supreme Court Classifies Service Advisors as Exempt under FLSA

In a 5-4 decision issued yesterday, the United States Supreme Court ruled that service advisors who work for auto dealerships are not entitled to overtime under the Fair Labor Standards Act (“FLSA”). The Court’s ruling in...more

Supreme Court Rejects Narrow Interpretation of FLSA Statutory Exemptions

by Holland & Knight LLP on

• In Encino Motorcars, LLC v. Hector Navarro, et al., the U.S. Supreme Court decided 5-4 that service advisors at car dealerships are exempt from overtime pay under the Fair Labor Standards Act (FLSA). • The Court held...more

Supreme Court Decides Encino Motorcars, LLC v. Navarro

by Faegre Baker Daniels on

On April 2, 2018, the Supreme Court decided Encino Motorcars, LLC v. Navarro, No. 16-1362, holding in a 5-4 decision that the Fair Labor Standards Act (FLSA) exempts service advisors at car dealerships from the Act’s...more

Supreme Court Rejects "Narrow Construction Principle" in Cases Interpreting Fair Labor Standards Act Exemptions

by Faegre Baker Daniels on

In a case analyzing a limited-use exemption to the overtime requirements of the Fair Labor Standards Act (the exemption at issue applies to salesmen and mechanics primarily engaged in selling or servicing automobiles), the...more

Supreme Court Exemption Decision Could Have Broader Repercussions

by BakerHostetler on

Need FLSA exemptions be narrowly construed? On April 2, the United States Supreme Court issued its decision on the issue of whether the Fair Labor Standards Act’s (FLSA) exemption for those selling or servicing automobiles...more

Is Employee Out of Commission? Not So Fast, Says Appellate Court

by Zuckerman Spaeder LLP on

When an employer changes its contract with an employee, the change should be communicated clearly—and preferably, in writing. Otherwise, the employer may be at risk of finding that the old terms still control. For example,...more

MiFID II and commissions: Implications for technology costs

New MiFID II rules around which services buy-side firms may pay for through commission payments with brokers makes an important distinction....more

Focus on ERISA - Tax Reform Includes Benefits and Compensation Provisions

by Dechert LLP on

On December 22, 2017, the tax reform bill, informally known as the Tax Cuts and Jobs Act (the “Act”), was signed by President Trump. As we noted in our prior OnPoint (available here) with respect to earlier versions of the...more

Case Interpreting FLSA Highly Compensated Exemption Takes Interesting Slant

by Fox Rothschild LLP on

There has not been much litigation over the HCE, the so-called Highly Compensated Employee exemption under the FLSA. Recently, an interesting case explored the issue of whether commission payments can form the entirety of the...more

Court Affirms Dismissal Of Claim For Commissions For Placement Of Puerto Rican Public Liability Insurance

by Carlton Fields on

Plaintiffs Berkley Risk Solutions LLC, an insurance and reinsurance management services provider, and Admiral Insurance Co., an excess and surplus lines insurer, sued Industrial Re-International Inc., a New York reinsurance...more

Sixth Circuit Provides Clarification On Legality Of Draw-On-Commission Policy

Last month, the Sixth Circuit revived a lawsuit brought under the Fair Labor Standards Act (“FLSA”) alleging that a retailer’s commission policy was unlawful in Stein v. hhgregg, Inc., 2017 U.S. App. LEXIS 19908 (6th Cir....more

California Commissioned Salespersons May Be Entitled to Separate Compensation for Wide Range of Activities in Addition to Rest...

Commissioned salespersons are employed in a variety of industries. While “outside salespeople” are generally exempt from minimum wage and meal and rest break requirements, so-called “inside” salespeople working at a retail...more

Sales Commission Agreements Can Limit Potential Liability

by Foley & Lardner LLP on

A manufacturing company’s sales employee successfully convinces a new customer to purchase a commercial cooler. Under the employee’s sales commission plan, she receives a commission of 2% of the price of the cooler and any...more

Sixth Circuit Draws the Line: Draws on Future Commissions and Post-Termination Payback Policies

Employers beware. A recent case serves as a reminder as we wind down the calendar year that employers should closely review their policies and procedures applying to employees paid on a 100% commission or draw basis. In Stein...more

A “New Look” for Salon Employee Commission Arrangements in California

A new addition to California law changes the definition of commission pay for licensed employees of beauty salons and barber shops. Under the new law, certain common arrangements, such as agreements to pay stylists on a...more

ComMISSION Impossible: The Pitfalls of California Commission Agreements

by Seyfarth Shaw LLP on

Seyfarth Synopsis: There are many different ways to pay employees in California. What is the scoop behind paying commissions? What are commission agreements and how have courts deciphered their coded mysteries?...more

Are "Draws" Against Commissions Unlawful "Kick-Backs"?

by Fisher Phillips on

Media reports have mistakenly suggested that a recent decision by the Sixth Circuit U.S. Court of Appeals (Kentucky, Michigan, Ohio, and Tennessee) found the federal Fair Labor Standards Act to prohibit recouping a draw or...more

National Appliance And Electronics Retailer’s Sales Commission Policy Was Lawful – For The Most Part, Sixth Circuit Rules

by Jackson Lewis P.C. on

In what may be viewed as a pyrrhic victory, now-defunct[1] “big box” electronics, appliance and furniture retailer hhgregg’s commission-with-draws compensation program generally was lawful under the FLSA, the Sixth Circuit...more

Big Commissions & FLSA Omissions: How Employers Could Be Required to Pay Six-Figure Earners Overtime Wages

by Seyfarth Shaw LLP on

Seyfarth Synopsis: A recent decision highlights why the FLSA is not always the remedial statute created to protect low-income workers by holding that four commission-based sales representatives, each earning six figures, were...more

Employer Can Use Draw-On-Commissions but Cannot Require Repayment Upon Termination

On October 12, the Sixth Circuit Court of Appeals partially approved and partially rejected an unusual pay plan designed to satisfy federal minimum wage requirements. In Stein v. HHGregg, Inc., the employer placed retail...more

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