Commission Not Paid - Your Legal Rights

Complete guide to unpaid commission disputes. Learn the difference between contractual and discretionary commission, when commission is earned, and how to pursue claims at tribunal.

Quick Answer

If your contract promises commission and you have earned it (sale made, work completed), your employer is legally required to pay it as wages. Contractual commission is enforceable at Employment Tribunal as an unlawful wage deduction. Discretionary bonus (at employer's discretion, no fixed terms) is harder to claim but still actionable if you can prove a written promise or clear pattern of past payment. Claims include interest of 8% per annum from the date payment was due. Withholding earned commission could constitute constructive dismissal if done to force resignation.

How to Claim Unpaid Commission

1

Establish Contractual Right to Commission

Check your employment contract, offer letter, and written job descriptions. Commission is legally owed if: (1) the contract specifies commission is payable, (2) the amount or method is stated, (3) the trigger is clear (e.g., 'commission on sales made'). Collect emails, messages, or other evidence showing commission was promised. Proof of past commission payments strengthens your claim.

2

Prove Commission Was Earned

Gather evidence that you satisfied the trigger for commission: sales records, customer orders, transaction receipts, emails confirming deals closed, manager approval records. Show dates when commission was earned and became due under the contract. Calculate the amount: number of sales/units × commission rate per contract. Add 8% interest per annum from the due date.

3

Request Payment and File at Tribunal

Send formal written demand with calculation and evidence. Give employer 14 days to pay. If they refuse, file an ET1 claim at Employment Tribunal (free) claiming unlawful wage deduction. Tribunal will award commission plus interest and possibly costs if employer's refusal was unreasonable. Hearing typically within 3-6 months.

What the Law Says

Employment Rights Act 1996, s.13-27
Prohibits unauthorised wage deductions. Earned commission is part of wages. If your contract specifies commission and you have earned it, withholding payment is an unlawful deduction. You can claim at tribunal within 3 months of the deduction. Interest accrues at 8% per annum from the date payment was due. No waiver or contract clause can override this right.
Malik v BCCI (1997) - Implied Contractual Duty
Even if commission terms are not crystal clear in writing, an implied term of contract can be enforced. If you can show a clear pattern of past commission payments, or manager confirmations that commission will be paid, tribunal may find an implied contractual obligation. Consistent statements by management about commission rates can amount to contractual terms.
Cavendish Square Holdings v Makdessi (2015) - Contractual Interpretation
Courts interpret commission clauses against the employer (if ambiguous). If your contract says 'commission on sales' but doesn't define 'sale', tribunal will interpret it in your favour (e.g., order placed, not paid invoice). Ambiguity favours the employee.
Constructive Dismissal - Withholding Commission
If employer systematically withholds earned commission to force you to resign, this may be constructive dismissal. You can claim unfair dismissal plus unpaid commission. Constructive dismissal claims require showing that conduct was a fundamental breach of the employment contract.

Common Commission Disputes

Sales Commission Not Paid

You closed 5 sales at £500 commission each = £2,500. Contract states commission on all sales made. Employer claims deals fell through post-signature. Tribunal will look at the contract terms: if 'sale made' means signed contract, you're owed £2,500 plus 8% interest. Proof of order confirmations strengthens your claim.

Commission Owed on Termination

You were dismissed with £4,000 earned commission unpaid. Commission earned is wages due. Must be paid on final payslip or within reasonable timeframe. Claim as unlawful wage deduction at tribunal. Employer cannot withhold commission on termination to recover 'claw-back' unless contract explicitly allows it.

Discretionary Bonus Promised Verbally

Manager promised £1,000 annual bonus if targets met. You met targets; bonus was refused. Claim harder than contractual commission but still actionable. Collect evidence: witnesses to the promise, emails mentioning bonus, previous years' bonus payments. Tribunal may find an implied contractual term if there's clear evidence and consistent past practice.

Commission Withheld as 'Claw-Back'

You earned £3,000 commission. Employer deducted £2,000 claiming chargebacks or customer returns. Contract must explicitly allow claw-back. If no clause, deduction is unlawful. You can claim the £2,000 back as unlawful wage deduction. Only amounts actually owed (after legitimate deductions) can be clawed back.

Commission Formula Miscalculated

Contract specifies 2% commission on gross sale value. You closed £50,000 in sales; should be £1,000. Employer paid £500 (1% rate). Claim the £500 shortfall plus 8% interest. Tribunal will enforce the contractual formula exactly as written.

Commission Payment Repeatedly Delayed

Commission due monthly; you're paid 3-4 months late regularly. This is unlawful deduction (payment delayed beyond agreed terms). Each month's delay is a separate deduction. Claim all delayed amounts plus 8% interest per annum from each original due date. Pattern of delays strengthens your case.

Frequently Asked Questions

What's the difference between contractual and discretionary commission? +
Contractual commission is promised in writing with fixed terms (rate, trigger, payment date). It's legally owed once earned. Discretionary commission is at the employer's sole discretion - no legal obligation unless you can prove an implied contract or written promise. Contractual claims are easier to win at tribunal.
When is commission considered 'earned'? +
Commission is earned when the contractual trigger is met. If the contract says 'commission on sales made', it's earned when the sale is made (order signed). If it says 'commission on paid invoices', it's earned when payment is received. Check your exact contract wording - the trigger determines when it's earned and due.
Can my employer claw back earned commission? +
Only if the contract explicitly allows it (e.g., 'commission subject to customer payment' or 'commission can be clawed back on chargebacks'). Without a clear clause, claw-back is unlawful deduction. Even with a clause, it must be fair and specific. Blanket claw-back rights are often challenged at tribunal as unreasonable.
What if I left the company? Can I still claim commission? +
Yes. If commission was earned before you left, you can claim it regardless of termination reason. Commission owed is wages owed. You must file a tribunal claim within 3 months of leaving. Interest accrues at 8% per annum from the original due date.
Is there interest on unpaid commission? +
Yes. Interest of 8% per annum accrues automatically from the date payment was due under your contract. If commission was due 31 December and it's now 1 July (7 months), you calculate the payment amount plus (amount × 8% × 7/12) in interest.
Can I claim commission if it wasn't written in my contract? +
Possibly. If you have strong evidence (emails from your manager, offer letter, handbook, witness testimony), tribunal may find an implied contractual term. Past payments of commission also support an implied obligation. Written evidence is much stronger, but you can still claim with corroborating proof.

Claim Your Unpaid Commission

Use FightingBack's Wages Checker to calculate your commission owed and file a tribunal claim.

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