Commissions are wages
Labor Code §200 defines wages broadly to include amounts for labor performed, whether fixed or calculated by time, task, piece or commission. Earned commissions are therefore protected like other wages: they must be paid on time, they must be shown on your wage statement, and an employer generally cannot take them back as a penalty or because a customer later complained, unless the written plan validly provides for that.
Commission pay can also affect other rights. Commissions are generally included in the regular rate used to calculate overtime, and some commissioned employees in retail or service jobs are exempt from overtime only if specific conditions in the wage orders are met, including that more than half of their pay comes from commissions.
The written commission contract
Under Labor Code §2751, when an employer pays commissions for services in California, the contract must be in writing and must set out the method by which commissions are computed and paid. The employer must give the employee a signed copy and get a signed receipt. If a contract expires and the parties keep working, the terms generally continue until a new contract is signed or employment ends.
If there is no written plan, or the plan is unclear, courts generally look at what the parties agreed and how commissions were paid in practice. Ambiguous terms are often read against the employer that drafted them.
Commissions when employment ends
Whether you are fired or quit, the employer must pay all wages earned and unpaid on the schedule in Labor Code §§201 and 202. A commission that was fully earned before you left is part of those wages, even if the employer usually pays commissions later in the month. Commissions that become payable only after a later event, such as the customer paying the invoice, are usually due when that condition is met, depending on the plan.
A plan cannot generally make you forfeit commissions you already earned just because you are no longer employed. Clauses that require you to be employed on the payout date are often disputed, and the answer depends on when, under the plan, the commission was earned. If the employer willfully fails to pay earned commissions on time when you leave, waiting-time penalties under Labor Code §203 may apply.
How to claim unpaid commissions
Collect the commission plan and every version you signed, your sales reports, customer invoices, payment records and pay stubs. Write down which deals you closed, when, and what the employer told you about payment. Ask for your payroll records in writing under Labor Code §226 if you need them.
You can file a wage claim with the Labor Commissioner or bring a lawsuit. Limitation periods for wage claims generally run from when the commission was due, so do not wait. An employment attorney can check the plan and calculate what is owed before you decide which route to take.
Your next steps
- Earned commissions are wages and must be paid, including after you leave.
- Keep every signed version of the commission plan and your own record of deals closed.
- Whether a commission was earned usually depends on the exact wording of the plan.
Sources and legal basis
- California Labor Code §2751 (commission contracts)
- California Labor Code §200 (definition of wages)
- California Labor Code §203 (waiting-time penalties)
- Labor Commissioner: how to file a wage claim
General information about federal and California law as of October 30, 2026, not legal advice. Your facts and later changes in the law can change the answer. A request does not stop any deadline.