State laws that affect the relationship between a manufacturer and a commissioned independent sales representative
Posted: June 12, 2013 Filed under: Uncategorized | Tags: Commission (remuneration), Contract, Independent Rep, Independent Sales Rep. Independent Sales Representative, Iowa, Lawsuit, Manufacturer, Principal, Rep, Sales, Sales Rep, statute, Termination of employment Leave a commentYou need to make sure you understand the law if you are a manufacturer or an independent sales representative. For this chart, the following definitions shall apply.
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Referenced in a Statute as: |
Referred to Here as: |
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Manufacturer, Principal or Employer |
Mfg. |
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Commissioned Sales Person, Wholesale Sales Representative, Sales Representative, Employee (Iowa) |
Rep |
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Contract |
K |
The Headings used are defined or explained as:
State: This is the state where the law is applicable. Most of the statutes, however, say that a rep can sue for unpaid commissions in this state for money owed by the manufacturer in other states. Eleven states require a written contract between the Mfg. and the Rep. Three states probably require a written contract between a Mfg. and Rep. All states say that a request to pay a person a commission for a sale is a contract.
Statute Name & Number: This is the name of the statute and number of the statute. This is always linked to the statute.
K Required: This means the burden is on the Manufacturer to create a written contract. Many of the statutes require not only a signature of both parties but proof in the form of a receipt that the rep has received a copy of the contract.
Written K Controls (except non-payment issues): If there is a dispute or the written contract is different from the statute the written contract controls the payment of commissions upon termination.
Other K Requirements: Any special or unique issues in the statute that may be of importance.
Pay upon Termination: This is what the statute requires as far as commissions paid upon termination of the contract with the Rep.
Damages: If the Rep is not paid as per the contract or the statute, this sets forth the damages that a rep can recover for non-payment. Most states this is a factor of the commissions owed, which can be as much as four times the commissions owed. Iowa, Michigan, Minnesota and Missouri have more complicated ways of determining damages based upon the time until paid or other ways to calculate the damages.
Most states allow a rep, if successful in a suit to recover unpaid commission’s damages in excess of the commissions owed. In several cases that amount totals four times the commissions owed. If the rep is successful in recovering damages, the rep can also recover attorney fees and court costs.
Eight states allow the Mfg. to recover attorney fees and court costs if the lawsuit filed by the Rep was frivolous. Frivolous in a legal context means there was no basis for the suit. Have a claim and losing it for some reason, is not frivolous.
Most states require commissions that were earned but not due until after the termination of the Contact between the Mfg., and the Rep must be paid to the Rep.
Court Costs & Atty Fees: Either the Rep or in a few cases, the Prevailing party (winner) can recover court costs and attorney’s fees if they successfully sue for unpaid commissions.
Suit brought in a state of Rep Choice: This statute states that even though the Mfg. may not have a business location within the state, which would normally be needed to establish venue and jurisdiction over the manufacturer, the statute provides the necessary venue and jurisdiction. That means the manufacturer can be brought to suit in that state.
K can waive the statute: This means that a contract between the Rep and the Mfg. cannot waive parts of the statute, specifically the requirement on how commissions are to be paid on termination, damages, attorney fees and costs and whether and jurisdiction and venue are established.
Misc.: More unique or important sections of the statute you should know about.
This information is here as a starting point. Contact your attorney for additional information.
Click here to download a copy of this chart
27 state laws and short interpretations are listed below.
| State | Statute Name & Number | K Required | Written K Controls (except non-payment issues) | Other K Requirements | Pay upon Termination | Damages | Court Costs & Atty Fees | Suit brought in state of Rep Choice | K can waive statute | Misc |
| Alabama | Alabama Code Annotated § 8-24-1 | Maybe§ 8-24-2 | Yes§ 8-24-2 | Contract must set forth how commission calculated and to be paid. Mft must provide copy of contract to rep§ 44-1798.01 | 30 Days after termination30 Days post termination§ 8-24-2(c) | Three times damages§ 8-24-3 | Reasonable Attorney fees and Costs§ 8-24-3 | Yes§ 8-24-4 | No§ 8-24-5 | Rep can bring all claims against mfg in this action§ 8-24-5 |
| Arizona | Arizona Revised Statutes § 44-1798.01 | Yes§ 44-1798.01 A | Rep must receive a signed copy of the contract and sign a receipt acknowledging receipt of signed copy§ 44-1798.01 B | Paid within 30 days§ 44-1798.02 A14 days on commissions due after termination§ 44-1798.02 B | Three times the unpaid commissions owed§ 44-1798.02 C | Reasonable attorney fees and costs§ 44-1798.02 D | Final Settlement null & void unless paid in full§ 44-1798.02 F | |||
| Arkansas | Arkansas Code of 1987 4-70-301 |
Yes4-70-302(a) | Method of computation and payment must be in written contract4-70-302(a)Rep must receive copy of contract 4-70-302(b) | If not written contract, all commissions must be paid within 30 days after termination4-70-303 | 3 times damages4-70-306 | Reasonable attorney fees and costs4-70-306 | Yes4-70-302(c)4-70-304 | Waiver of statute is void4-70-305 | ||
| California | California Codes Annotated § 1738.10Independent Wholesale Sales Representatives Contractual Relations Act of 1990§ 1738.11 | Yes§ 1738.13(a) | Commission Rate, Payment dates, Territory, Territory Exceptions, ChargebacksRep must be given a copy of the contract, sign it and sign a receipt acknowledging receipt of the signed contract§ 1738.13(b) | Treble DamagesFailure to pay or Failure to have written contract§ 1738.15 | The Prevailing Party can recover Reasonable Attorney Fees & Costs§ 1738.16 | Yes§ 1738.14 | No§ 1738.13(e) | Rep must receive written info of all orders, customer name and invoice numberCommission rate on each order§ 1738.13(c) | ||
| Colorado | Colorado Revised Statutes 12-66-101 | Probably§ 12-66-103 | Treble damages12-66-103(1) | Prevailing Party receives Reasonable attorney fees and costs | Yes12-66-102 | |||||
| Illinois | Sales Representative Act. Illinois Compiled Statutes Annotated § 820 ILCS 120/0.01. | 13 days after termination and 13 days if commissions become payable after termination§ 820 ILCS 120/2 | Exemplary damages of 3 times commissions owed§ 820 ILCS 120/3 | Reasonable attorney fees and court costs to rep§ 820 ILCS 120/3 | No§ 820 ILCS 120/2 | |||||
| Indiana | Indiana Statutes Annotated 24-4-7-0.1 | Must be paid within 14 days24-4-7-5(a) | Exemplary Damages Three times the commissions owed24-4-7-5(b) | If exemplary damages awarded, the sales rep receives reasonable attorney fees and costs24-4-7-5(c)If suit is frivolous, the mfg can receive reasonable attorney fees and costs 24-4-7-5(c) | Yes24-4-7-6 | No24-4-7-8 | If you make an offer to pay commissions you cannot revoke the offer once the commissions are earned 24-4-7-7 | |||
| Iowa | Iowa Wage Payment Collection Law Iowa Code 91A.1 |
5% per day for every day not paid91A.2 6 | Yes if intentionally failed to pay91A.8 | Only disputed amounts can be withheld, all non-disputed amounts of commissions must be paid91A.7 | ||||||
| Louisiana | Louisiana Revised Statutes § 51:441 | Yes§ 51:442 | A written contract supersedes statute on payment of wages§ 51:442 | Rep must receive a copy of the contract§ 51:442 | Per the contract or On the 30th working day after termination§ 51:443 | Treble damages§ 51:444 | Rep’s Attorney fees§ 51:444 | Yes§ 51:445 A§ 51:445 C | No§ 51:445 B | Sales Rep can sue for all money owed under this statute.Statute does not prohibit other seeking other forms of relief§ 51:445 D |
| Maine | Maine Revised Statutes Annotated § 1341 | Unless otherwise in contract requires 14 days’ notice to terminate§ 1342 | Payment within 30 days of termination§ 1343 | Exemplary damages of 3 times commissions owed§ 1344 1 | Reasonable attorney fees and costs§ 1344 1 | Yes§ 1344 4 | Yes§ 1343 | If action was frivolous mfg can recover actual attorney fees and costs§ 1344 2 | ||
| Maryland | Annotated Code of Maryland § 3-601 |
Commissions must be paid within 45 days of termination§ 3-604 | Can recover up to 3 times the commissions due§ 3-605(a)(1) | Reasonable attorney fees and costs§ 3-605(b) | Yes§ 3-606 | Law cannot be waived§ 3-603 | Rep must give mfg 10 days’ | |||
| Massachusetts | Annotated Laws of Massachusetts Chpt 104 § 7 |
YesChpt 104 § 8 | Commissions must be paid within 14 days of terminationChpt 104 § 8Commissions that come due after termination must be paid within 14 daysChpt 104 § 8 | Willfully or knowingly fails to pay, rep can recover an additional 3 times the amount dueChpt 104 § 9 | Rep can recover reasonable attorney fees and court costsChpt 104 § 9 | Yes104 § 9 | NoChpt 104 § 9 | |||
| Michigan | Michigan Compiled Laws § 600.2961 | YesSec. 2961(e)(2) | Commissions must be paid within 45 days of termination§ 600.2961(e)(4) | Actual damages plus 2 times amount of commissions or $100K or whatever is less§ 600.2961(e)(5)(b) | Rep can recover reasonable attorney fees and costs§ 600.2961(e)(5) | No§ 600.2961(e)(8) | ||||
| Minnesota | Minnesota Statutes 181.13 | Yes§ 407.912 | 3 days after termination181.145 Subd 2 | Penalty of 1/15 per day not to exceed 15 days181.145 Subd 3 | Yes181.171 Subd 3 | Sales made before termination must be paid after termination181.145 Subd 5 | ||||
| Missouri | Missouri § 407.911 | Yes§ 407.912 | Within 30 days of termination§ 407.912 | Based on the time due till paid§ 407.913 | Reasonable attorney fees and costs§ 407.913 | Yes§ 407.914 | No§ 407.915 | Rep to be paid on commissions earned before termination but not due until after termination§ 407.912 2 | ||
| Nebraska | Nebraska Wage Payment and Collection Act Nebraska Revised Statutes Annotated § 48-1229 | 30 days after termination§ 48-1231(1) | Court Costs and attorney fees of not less than 25% of damages§ 48-1231(1) | Damages are increased if case appealed§ 48-1231(1) | ||||||
| New Hampshire | Sales Representatives and Post-Termination Commissions New Hampshire Revised Statutes Annotated 339-E:1 | Yes339-E:2 | Commissions must be paid within 45 days of termination339-E:2 | Exemplary damages of 3 times commission339-E:3 | Reasonable attorney fees and costs339-E:3 | Yes339-E:4 | No339-E:2 & 339-E:6 | Commissions must be paid on orders before termination§ 2A:61A-2If Sales Rep brings frivolous suit mfg. can recover attorney fees§ 2A:61A-3 | ||
| New Jersey | New Jersey Annotated Statutes § 2A:61A-1. |
Must be paid within 30 days§ 2A:61A-2 | Exemplary damages of 3 times amount of commissions owed§ 2A:61A-3 | Actual and reasonable attorney fees and costs§ 2A:61A-3 | Yes§ 2A:61A-5 | No§ 2A:61A-6 | ||||
| New York | New York Consolidated Laws § 190 |
Yes§ 191-b 1 | Yes, K must be signed by both parties and kept on file at mfg. for 3 years§ 191 b | Must be paid within 5 business days§ 191-c 1 | Double damages§ 191-c 3 | Prevailing party receives reasonable attorney fees and costs§ 191-c 3 | Commissions must be paid at least monthly§ 191 cCommissions earned after termination must be paid§ 191-a (b) | |||
| North Carolina | General Statutes of North Carolina § 66-190 | Yes§ 66-190.1 | 30 days after termination unless rep commits malfeasance§ 66-191 | 2 times damages§ 66-192(a) | Attorney fees actually and reasonably incurred and court costs§ 66-192(c) | Yes§ 66-192(c) | No§ 66-193 | Commissions that come due after termination must be paid within 15 days§ 66-191 | ||
| Oklahoma | Sales Representatives Recognition Act Oklahoma Statutes Annotated § 675 | Yes§ 677 1 | 14 days after termination14 days on commissions that come due after termination§ 678 A | Prevailing party reasonable attorney fees and costs§ 678 B | Yes§ 679 A | No§ 679 B | Rep can recover all claims in OK case against mfg§ 679 C | |||
| Pennsylvania | Commissioned Sales Representatives Pennsylvania Statutes Annotated § 1471 | Yes§ 1472 | Yes§ 1475.1 | 14 days after termination§ 147314 days on commissions earned after termination§ 1474 | 2 times the commissions due§ 1475(a)(1) | Cost of the suit and reasonable attorney fees§ 1475(a)(2) | No§ 1476 | If case is frivolous then mfg can recover reasonable attorney fees and costs§ 1475(b) | ||
| South Carolina | Payment Of Post-Termination Claims To Sales Representatives South Carolina Code of Laws § 39-65-10 | Seems to be.§ 39-65-20 | Yes§ 39-65-20 | Paid as terms of the contract§ 39-65-20 | Commissions due plus 3 times damages§ 39-65-30(1) | Actually and reasonably incurred attorney fees and court costs§ 39-65-30(2) | Yes§ 39-65-50 | No§ 39-65-70 | If the suit brought by the Rep is frivolous the mfg may recover attorney fees and costs§ 39-65-40Rep may bring all actions against mfg in SC§ 39-65-60 | |
| Tennessee | Tennessee Code Annotated § 47-50-114 | Yes47-50-114 (b) (1) | Yes§ 47-50-114(b)(1) | 14 days after termination§ 47-50-114(b)(c) | Mfg acting in bad faith liable for exemplary damages of treble the amount of commissions§ 47-50-114(d) | Reasonable attorney’s fees and court costs§ 47-50-114(d) | Yes§ 47-50-114(e) | No§ 47-50-114(f) | Commissions earned after termination must be paid within 14 days§ 47-50-114(b)(c)If action brought by Rep is frivolous mfg can recover attorney fees and court costs47-50-114(d) | |
| Virginia | Code of Virginia § 59.1-455 | Yes§ 59.1-456 | Yes§ 59.1-457 | Per contract but not later than 30 days§ 59.1-457 | No§ 59.1-458 | Post termination commissions must be paid within 30 days§ 59.1-457 | ||||
| Washington | Annotated Revised Code of Washington §49.48.150 | Yes§49.48.160(1) | Yes§49.48.160(1) | Per contract but no later than 30 days§49.48.160(3) | Yes§49.48.180 | No§49.48.160(1) §49.48.190 |
All commissions including commissions earned by not due must be paid upon termination§49.48.160 | |||
| Wisconsin | Wisconsin Statute § 134.93 | Yes§ 134.93(3) | Due upon termination§ 134.93(4) | Exemplary damages 200% of the commission owed§ 134.93(5) | 90 days written notice of termination must be given to rep§ 134.93(3) |
If you are a manufacturer, distributor or importer hiring independent reps, make sure you have a contract that protects you from being sued in 27 other states.
If you are a rep, insist on a contract with every manufacturer you represent.
Either way, you both will be better off.
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Maryland Sales Representative
Posted: March 17, 2013 Filed under: Maryland | Tags: Commission (remuneration), IC, Independent Sales Rep, MARYLAND, Rep, Sales, statute Leave a commentMaryland Sales Representative
LABOR AND EMPLOYMENT
TITLE 3. EMPLOYMENT STANDARDS AND CONDITIONS
SUBTITLE 6. WHOLESALE SALES REPRESENTATIVES
GO TO MARYLAND STATUTES ARCHIVE DIRECTORY
Md. LABOR AND EMPLOYMENT Code Ann. § 3-601 (2012)
§ 3-601. Definitions
(a) In general. — In this subtitle the following words have the meanings indicated.
(b) Commission. — “Commission” means compensation that:
(1) is due to a sales representative from a principal; and
(2) accrues at:
(i) a specified amount for each order or sale; or
(ii) a rate expressed as a percentage of the dollar amount that a sales representative:
1. takes in orders for the principal;
2. makes in sales for the principal; or
3. earns in profits for the principal.
(c) Principal. — “Principal” means a sales corporation, partnership, proprietorship, or other business entity that:
(1) distributes, imports, manufactures, or produces a product for wholesale;
(2) enters into a contract with a sales representative to solicit a wholesale order for the product; and
(3) pays the sales representative wholly or partly by commission.
(d) Sales representative. —
(1) “Sales representative” means a person who:
(i) enters into a contract with a principal to solicit in the State a wholesale order; and
(ii) is paid wholly or partly by commission.
(2) “Sales representative” does not include a person who:
(i) buys a product or places an order for a product for resale by that person; or
(ii) sells or takes an order for the sale of a product to an ultimate buyer.
§ 3-602. Scope of subtitle
This subtitle does not apply to an individual who is considered under the Maryland Wage Payment and Collection Law to be employed by a principal.
§ 3-603. Void waivers
A provision of a contract that is made between a sales representative and a principal is void if the provision purports to waive any provision of this subtitle by:
(1) an express waiver; or
(2) a contract subject to the laws of another state.
§ 3-604. Payment of commission on termination of contract
Each principal shall pay to a sales representative all commissions that are due under a contract that is terminated, within 45 days after payment would have been due if the contract had not terminated.
§ 3-605. Action by sales representative
(a) Treble damages. —
(1) Subject to the requirement of paragraph (2) of this subsection, if a principal violates § 3-604 of this subtitle, a sales representative whom the violation affects is entitled to bring an action against the principal to recover up to 3 times the amount of all commissions that the principal owes to the sales representative.
(2) At least 10 days before an action is brought under this subsection, the sales representative shall give the principal written notice of intent to bring the action.
(b) Costs. — If a court determines that a sales representative is entitled to judgment in an action under this section, the court shall allow against the principal reasonable counsel fees and court costs.
§ 3-606. Personal jurisdiction
For purposes of personal jurisdiction under § 6-103 of the Courts Article, a principal who contracts with a sales representative to solicit wholesale orders for a product in the State is considered to be transacting business in the State.
§ 3-607. Revocable offer of commission
(a) Entitlement to commission. — If a principal makes a revocable offer of a commission to a sales representative who is not an employee of the principal, the sales representative is entitled to the commission agreed on if:
(1) the principal revokes the offer of commission and the sales representative establishes that the revocation was for the purpose of avoiding payment of the commission; or
(2) (i) the revocation occurs after the sales representative has obtained a written order for the principal’s product because of the efforts of the sales representative; and
(ii) the principal’s product that is the subject of the order is shipped to and paid for by a customer.
(b) Construction of section. — This section may not be construed to:
(1) impair the application of § 2-201 or § 2-209 of the Commercial Law Article;
(2) abrogate any rule of agency law; or
(3) unconstitutionally impair the obligations of contracts.
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Minnesota Sales Representative
Posted: March 17, 2013 Filed under: Minnesota | Tags: Commission (remuneration), IC, Independent Sales Rep, Minnesota, Payment, Rep, Sales, Wage Leave a commentLABOR, INDUSTRY
CHAPTER 181. EMPLOYMENT
PAYMENT OF WAGES
GO TO MINNESOTA STATUTES ARCHIVE DIRECTORY
Minn. Stat. § 181.13 (2012)
181.13 PENALTY FOR FAILURE TO PAY WAGES PROMPTLY
(a) When any employer employing labor within this state discharges an employee, the wages or commissions actually earned and unpaid at the time of the discharge are immediately due and payable upon demand of the employee. If the employee’s earned wages and commissions are not paid within 24 hours after demand, whether the employment was by the day, hour, week, month, or piece or by commissions, the employer is in default. The discharged employee may charge and collect the amount of the employee’s average daily earnings at the rate agreed upon in the contract of employment, for each day up to 15 days, that the employer is in default, until full payment or other settlement, satisfactory to the discharged employee, is made. In the case of a public employer where approval of expenditures by a governing board is required, the 24-hour period for payment does not commence until the date of the first regular or special meeting of the governing board following discharge of the employee.
(b) The wages and commissions must be paid at the usual place of payment unless the employee requests that the wages and commissions be sent through the mails. If, in accordance with a request by the employee, the employee’s wages and commissions are sent to the employee through the mail, the wages and commissions are paid as of the date of their postmark.
181.14 PAYMENT TO EMPLOYEES WHO QUIT OR RESIGN; SETTLEMENT OF DISPUTES
Subdivision 1. Prompt payment required.
(a) When any such employee quits or resigns employment, the wages or commissions earned and unpaid at the time the employee quits or resigns shall be paid in full not later than the first regularly scheduled payday following the employee’s final day of employment, unless an employee is subject to a collective bargaining agreement with a different provision. If the first regularly scheduled payday is less than five calendar days following the employee’s final day of employment, full payment may be delayed until the second regularly scheduled payday but shall not exceed a total of 20 calendar days following the employee’s final day of employment.
(b) Notwithstanding the provisions of paragraph (a), in the case of migrant workers, as defined in section 181.85, the wages or commissions earned and unpaid at the time the employee quits or resigns shall become due and payable within five days thereafter.
Subd. 2. Nonprompt payment. –Wages or commissions not paid within the required time period shall become immediately payable upon the demand of the employee. If the employee’s earned wages or commissions are not paid within 24 hours after the demand, the employer shall be liable to the employee for an additional sum equal to the amount of the employee’s average daily earnings provided in the contract of employment, for every day, not exceeding 15 days in all, until such payment or other settlement satisfactory to the employee is made.
Subd. 3. Settlement of disputes. –If the employer disputes the amount of wages or commissions claimed by the employee under the provisions of this section or section 181.13, and the employer makes a legal tender of the amount which the employer in good faith claims to be due, the employer shall not be liable for any sum greater than the amount so tendered and interest thereon at the legal rate, unless, in an action brought in a court having jurisdiction, the employee recovers a greater sum than the amount so tendered with interest thereon; and if, in the suit, the employee fails to recover a greater sum than that so tendered, with interest, the employee shall pay the cost of the suit, otherwise the cost shall be paid by the employer.
Subd. 4. Employees entrusted with money or property. –In cases where the discharged or quitting employee was, during employment, entrusted with the collection, disbursement, or handling of money or property, the employer shall have ten calendar days after the termination of the employment to audit and adjust the accounts of the employee before the employee’s wages or commissions shall be paid as provided in this section, and the penalty herein provided shall apply in such case only from the date of demand made after the expiration of the period allowed for payment of the employee’s wages or commissions. If, upon such audit and adjustment of the accounts of the employee, it is found that any money or property entrusted to the employee by the employer has not been properly accounted for or paid over to the employer, as provided by the terms of the contract of employment, the employee shall not be entitled to the benefit of sections 181.13 to 181.171, but the claim for unpaid wages or commissions of such employee, if any, shall be disposed of as provided by existing law.
Subd. 5. Place of payment. –Wages and commissions paid under this section shall be paid at the usual place of payment unless the employee requests that the wages and commissions be sent to the employee through the mails. If, in accordance with a request by the employee, the employee’s wages and commissions are sent to the employee through the mail, the wages and commissions shall be deemed to have been paid as of the date of their postmark for the purposes of this section.
181.145 PROMPT PAYMENT OF COMMISSIONS TO COMMISSION SALESPEOPLE
Subdivision 1. Definitions. –For the purposes of this section, “commission salesperson” means a person who is paid on the basis of commissions for sales and who is not covered by sections 181.13 and 181.14 because the person is an independent contractor. For the purposes of this section, the phrase “commissions earned through the last day of employment” means commissions due for services or merchandise which have actually been delivered to and accepted by the customer by the final day of the salesperson’s employment.
Subd. 2. Prompt payment required.
(a) When any person, firm, company, association, or corporation employing a commission salesperson in this state terminates the salesperson, or when the salesperson resigns that position, the employer shall promptly pay the salesperson, at the usual place of payment, commissions earned through the last day of employment or be liable to the salesperson for the penalty provided under subdivision 3 in addition to any earned commissions unless the employee requests that the commissions be sent to the employee through the mails. If, in accordance with a request by the employee, the employee’s commissions are sent to the employee through the mail, the commissions shall be deemed to have been paid as of the date of their postmark for the purposes of this section.
(b) If the employer terminates the salesperson or if the salesperson resigns giving at least five days’ written notice, the employer shall pay the salesperson’s commissions earned through the last day of employment on demand no later than three working days after the salesperson’s last day of work.
(c) If the salesperson resigns without giving at least five days’ written notice, the employer shall pay the sales-person’s commissions earned through the last day of employment on demand no later than six working days after the salesperson’s last day of work.
(d) Notwithstanding the provisions of paragraphs (b) and (c), if the terminated or resigning salesperson was, during employment, entrusted with the collection, disbursement, or handling of money or property, the employer has ten working days after the termination of employment to audit and adjust the accounts of the salesperson before the salesperson can demand commissions earned through the last day of employment. In such cases, the penalty provided in subdivision 3 shall apply only from the date of demand made after the expiration of the ten working day audit period.
Subd. 3. Penalty for nonprompt payment. –If the employer fails to pay the salesperson commissions earned through the last day of employment on demand within the applicable period as provided under subdivision 2, the employer shall be liable to the salesperson, in addition to earned commissions, for a penalty for each day, not exceeding 15 days, which the employer is late in making full payment or satisfactory settlement to the salesperson for the commissions earned through the last day of employment. The daily penalty shall be in an amount equal to 1/15 of the salesperson’s commissions earned through the last day of employment which are still unpaid at the time that the penalty will be assessed.
Subd. 4. Amount of commission disputed.
(a) When there is a dispute concerning the amount of the salesperson’s commissions earned through the last day of employment or whether the employer has properly audited and adjusted the salesperson’s account, the penalty provided in subdivision 3 shall not apply if the employer pays the amount it in good faith believes is owed the salesperson for commissions earned through the last day of employment within the applicable period as provided under subdivision 2; except that, if the dispute is later adjudicated and it is determined that the salesperson’s commissions earned through the last day of employment were greater than the amount paid by the employer, the penalty provided in subdivision 3 shall apply.
(b) If a dispute under this subdivision is later adjudicated and it is determined that the salesperson was not promptly paid commissions earned through the last day of employment as provided under subdivision 2, the employer shall pay reasonable attorney’s fees incurred by the salesperson.
Subd. 5. Commissions earned after last day of employment. –Nothing in this section shall be construed to impair a commission salesperson from collecting commissions on merchandise ordered prior to the last day of employment but delivered and accepted after termination of employment. However, the penalties prescribed in subdivision 3 apply only with respect to the payment of commissions earned through the last day of employment.
181.171 COURT ACTIONS; PRIVATE PARTY CIVIL ACTIONS
Subdivision 1. Civil action; damages. –A person may bring a civil action seeking redress for violations of sections 181.02, 181.03, 181.031, 181.032, 181.08, 181.09, 181.10, 181.101, 181.11, 181.12, 181.13, 181.14, 181.145, and 181.15 directly to district court. An employer who is found to have violated the above sections is liable to the aggrieved party for the civil penalties or damages provided for in the section violated. An employer who is found to have violated the above sections shall also be liable for compensatory damages and other appropriate relief including but not limited to injunctive relief.
Subd. 2. District court jurisdiction. –An action brought under subdivision 1 may be filed in the district court of the county wherein a violation is alleged to have been committed, where the respondent resides or has a principal place of business, or any other court of competent jurisdiction.
Subd. 3. Attorney fees and costs. –In an action brought under subdivision 1, the court shall order an employer who is found to have committed a violation to pay to the aggrieved party reasonable costs, disbursements, witness fees, and attorney fees.
Subd. 4. Employer; definition. –“Employer” means any person having one or more employees in Minnesota and includes the state and any political subdivision of the state. This definition applies to this section and sections 181.02, 181.03, 181.031, 181.032, 181.06, 181.063, 181.10, 181.101, 181.13, 181.14, and 181.16.
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Michigan Sales Representative
Posted: March 17, 2013 Filed under: Michigan | Tags: Commission (remuneration), Contract, IC, Independent Sales Rep, Manufacture, Michigan, Rep, Sales Leave a commentMICHIGAN COMPILED LAWS SERVICE
CHAPTER 600 REVISED JUDICATURE ACT OF 1961
REVISED JUDICATURE ACT OF 1961
CHAPTER 29. PROVISIONS CONCERNING SPECIFIC ACTIONS
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MCLS § 600.2961 (2012)
MCL § 600.2961
§ 600.2961. Definitions; determining when commission due; payment of commissions; liability; attorney fees and costs; jurisdiction; contract waiver void; applicability of section.
Sec. 2961. (1) As used in this section:
(a) “Commission” means compensation accruing to a sales representative for payment by a principal, the rate of which is expressed as a percentage of the amount of orders or sales or as a percentage of the dollar amount of profits.
(b) “Person” means an individual, corporation, partnership, association, governmental entity, or any other legal entity.
(c) “Prevailing party” means a party who wins on all the allegations of the complaint or on all of the responses to the complaint.
(d) “Principal” means a person that does either of the following:
(i) Manufactures, produces, imports, sells, or distributes a product in this state.
(ii) Contracts with a sales representative to solicit orders for or sell a product in this state.
(e) “Sales representative” means a person who contracts with or is employed by a principal for the solicitation of orders or sale of goods and is paid, in whole or in part, by commission. Sales representative does not include a person who places an order or sale for a product on his or her own account for resale by that sales representative.
(2) The terms of the contract between the principal and sales representative shall determine when a commission becomes due.
(3) If the time when the commission is due cannot be determined by a contract between the principal and sales representative, the past practices between the parties shall control or, if there are no past practices, the custom and usage prevalent in this state for the business that is the subject of the relationship between the parties.
(4) All commissions that are due at the time of termination of a contract between a sales representative and principal shall be paid within 45 days after the date of termination. Commissions that become due after the termination date shall be paid within 45 days after the date on which the commission became due.
(5) A principal who fails to comply with this section is liable to the sales representative for both of the following:
(a) Actual damages caused by the failure to pay the commissions when due.
(b) If the principal is found to have intentionally failed to pay the commission when due, an amount equal to 2 times the amount of commissions due but not paid as required by this section or $100,000.00, whichever is less.
(6) If a sales representative brings a cause of action pursuant to this section, the court shall award to the prevailing party reasonable attorney fees and court costs.
(7) In an action brought under this section, jurisdiction shall be determined in accordance with chapter 7.
(8) A provision in a contract between a principal and a sales representative purporting to waive any right under this section is void.
(9) This section does not affect the rights of a principal or sales representative that are otherwise provided by law.
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Missouri Sales Representative
Posted: March 17, 2013 Filed under: Missouri | Tags: Contract, IC, Independent Sales Rep, Manufacture, Missouri, Rep, Sales Leave a commentTITLE 26. TRADE AND COMMERCE (Chs. 400-421)
CHAPTER 407. MERCHANDISING PRACTICES
SALES COMMISSION
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§ 407.911 R.S.Mo. (2013)
§ 407.911. Definitions
As used in sections 407.911 to 407.915, the following terms mean:
(1) “Commission”, compensation accruing to a sales representative for payment by a principal, the rate of which is expressed as a percentage of the dollar amount of orders or sales, or as a specified amount per order or per sale;
(2) “Principal”, a person, firm, corporation, partnership or other business entity, whether or not it has a permanent or fixed place of business in this state, and who:
(a) Manufactures, produces, imports, provides, or distributes a product or service for sale;
(b) Contracts with a sales representative to solicit orders for the product or service; and
(c) Compensates the sales representative, in whole or in part, by commission;
(3) “Sales representative”, a person, firm, corporation, partnership, or other business entity who contracts with a principal to solicit orders and who is compensated, in whole or in part, by commission, but shall not include a person, firm, corporation, partnership, or other business entity who places orders or purchases for its own account for resale.
§ 407.912. Commission to become due, when — termination of employment, all commissions due, when
1. When a commission becomes due shall be determined in the following manner:
(1) The written terms of the contract between the principal and sales representative shall control;
(2) If there is no written contract, or if the terms of the written contract do not provide when the commission becomes due, or the terms are ambiguous or unclear, the commission shall be paid when the product or service is delivered and accepted by the purchaser or the principal receives satisfaction in full;
(3) If neither subdivision (1) nor (2) of this subsection can be used to clearly ascertain when the commission becomes due, then the commission shall be due on the date the principal accepts the order and receives satisfaction in full, unless the custom and usage prevalent in this state for the parties’ particular industry is different, in which event such custom and usage shall prevail.
2. Nothing in sections 407.911 to 407.915 shall be construed to impair a sales representative from collecting commissions on products or services ordered prior to the termination of the contract between the principal and the sales representative but delivered and accepted by the purchaser after such termination.
3. When the contract between a sales representative and a principal is terminated, all commissions then due shall be paid within thirty days of such termination. Any and all commissions which become due after the date of such termination shall be paid within thirty days of becoming due.
§ 407.913. Failure to pay sales representative commission, liability in civil action for actual damages — additional damages allowed — attorney fees and costs
Any principal who fails to timely pay the sales representative commissions earned by such sales representative shall be liable to the sales representative in a civil action for the actual damages sustained by the sales representative and an additional amount as if the sales representative were still earning commissions calculated on an annualized pro rata basis from the date of termination to the date of payment. In addition the court may award reasonable attorney’s fees and costs to the prevailing party.
§ 407.914. Out-of-state principal with sales representative soliciting in this state, Missouri courts to have jurisdiction
A principal who is not a resident or citizen of this state who contracts with a sales representative to solicit orders in this state is declared to be transacting business in this state for purposes of the exercise of jurisdiction of the courts of this state under section 506.500.
§ 407.915. Civil action for all claims against principal may be joined–express or contract waivers of commission laws, invalid
1. Nothing in sections 407.911 to 407.915 shall invalidate or restrict any other or additional right or remedy available to a sales representative from seeking to recover in one action on all claims against a principal.
2. A provision in any contract between a sales representative and a principal purporting to waive any provision of sections 407.911 to 407.915, whether by expressed waiver or by a contract subject to the laws of another state, shall be void.
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New Hampshire Sales Representative
Posted: March 17, 2013 Filed under: New Hampshire | Tags: Commission (remuneration), Contract, IC, Independent Sales Rep, Rep, Sales, STATUTES Leave a commentNEW HAMPSHIRE REVISED STATUTES ANNOTATED
TITLE XXXI Trade And Commerce
CHAPTER 339-E Sales Representatives and Post-Termination Commissions
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RSA 339-E:1 (2012)
339-E:1 Definitions.
In this chapter:
1. “Commission” means compensation paid a sales representative by a principal, the rate of which is expressed as a percentage of the dollar amount of orders or sales of the principal’s product.
2. “Principal” means a person who manufactures, produces, imports or distributes a product for sale to customers who purchase the product for resale; uses a sales representative to solicit orders for such product; and compensates individuals who solicit orders, in whole or in part, by commission.
3. “Sales representative” means an individual other than an employee, who contracts with a principal to solicit orders and who is compensated, in whole or in part, by commission but shall not include one who places orders or pur-chases exclusively for his own account for resale.
4. “Termination” means the end of services performed by the sales representative for the principal by discharge, resignation, or death.
339-E:2 Contract.
A sales representative and a principal shall enter into a written contract for services to be performed within this state by a sales representative. The written contract entered into pursuant to this section shall contain provisions which establish:
The form of payment and the method by which such payment is to be computed and paid;
Reasonable length of notice which either party must provide to the other for termination of the contract;
The number of calendar days, up to a maximum of 45 days, after the date of termination or notification of death when all commissions due shall be paid; and
Any other terms and conditions which the parties agree to include in such contract.
The principal shall provide the sales representative a signed copy of a written contract entered into pursuant to this section.
A provision in the contract establishing venue for an action arising under the contract in a state other than this state is void.
339-E:3 Damages.
The party who fails to comply with a provision of a contract entered into under RSA 339-E:2 relating to payment of a commission is liable in a civil action for damages, plus reasonable attorney’s fees and costs. The court may award exemplary damages of up to 3 times the commission owed in an action brought under this chapter.
339-E:4 Jurisdiction.
A principal who is not a resident of this state who enters into a contract with a sales representative subject to this chapter shall be considered to be doing business in this state for purposes of the exercise of personal jurisdiction over the principal.
339-E:5 Other Remedies; Combination of Claims.
Nothing in this chapter shall invalidate or restrict any other or additional right or remedy available to a sales representative, or preclude a sales representative from seeking to recover in one action on all claims against a principal.
339-E:6 No Waivers by Contract.
A provision in any contract between a sales representative and a principal purporting to waive any provision of this chapter, whether by expressed waiver or by a contract subject to the laws of another state, shall be void.
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Tennessee Sales Representative
Posted: March 17, 2013 Filed under: Tennessee | Tags: Contract, IC, Independent Sales Rep, Manufacture, Rep, Sales, STATUTES, Tennessee Leave a commentTENNESSEE CODE ANNOTATED
© 2013 by The State of Tennessee
All rights reserved
Title 47 Commercial Instruments And Transactions
Chapter 50 Miscellaneous Provisions
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Tenn. Code Ann. § 47-50-114 (2012)
47-50-114. Sales representatives—Commissions.
(a) As used in this section:
(1) “Commission” means compensation accruing to a sales representative for payment by a principal, the rate of which is expressed as a percentage of the dollar amount of orders or sales;
(2) “Principal” means a person who:
(A) Manufactures, produces, imports, or distributes a product for wholesale;
(B) Contracts with a sales representative to solicit orders for the product; and
(C) Compensates the sales representative, in whole or in part, by commission;
(3) “Sales representative” means a person who contracts with a principal to solicit wholesale orders and who is compensated, in whole or in part, by commission, but does not include one who places orders or purchases for such person’s own account for resale; and
(4) “Termination” means the end of services performed by the sales representative for the principal whether by discharge, resignation, or expiration of a contract.
(b) (1) The terms of the contract between the principal and sales representative shall determine when a commission becomes due.
(2) If the time when the commission is due cannot be determined by a contract between the principal and sales representative, the past practices between the parties shall control or, if there are no past practices, the custom and usage prevalent in this state for the business that is the subject of the relationship between the parties shall control.
(3) All commissions that are due at the time of termination of a contract between a sales representative and principal shall be paid within fourteen (14) days after the date of termination. Commissions that become due after the termination date shall be paid within fourteen (14) days after the date on which the commissions become due.
(c) When the contract between a sales representative and a principal is terminated and the contract was not reduced to writing, all commissions due shall be paid within fourteen (14) days of termination.
(d) A principal who, acting in bad faith, fails to comply with the provisions of subsection (c) concerning timely payment may be liable in a civil action for exemplary damages in an amount which does not exceed treble the amount of the commissions owed to the sales representative. Additionally, such principal shall pay the sales representative’s reasonable attorney’s fees and court costs. If the court determines that an action to collect such exemplary damages has been brought on frivolous grounds, reasonable attorney’s fees and court costs shall be awarded to the principal.
(e) A principal who is not a resident of this state and who enters into a contract subject to this chapter is considered to be doing business in this state for purposes of the exercise of personal jurisdiction over the principal.
(f) A provision of this chapter may not be waived, whether by express waiver or by attempt to make a contract or agreement subject to the laws of another state. A waiver of a provision of this chapter is void.
(g) This chapter does not invalidate or restrict any other right or remedy available to a sales representative or preclude a sales representative from seeking to recover in one (1) action on all claims against a principal.
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Virginia Independent Sales Rep
Posted: March 17, 2013 Filed under: Virginia | Tags: Contract, IC, Independent, Independent Sales Rep, Rep, Sales, Virginia Leave a commentCODE OF VIRGINIA
TITLE 59.1. TRADE AND COMMERCE
CHAPTER 37. CONTRACTS; INDEPENDENT SALES REPRESENTATIVES
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Va. Code Ann. § 59.1-455 (2013)
§ 59.1-455. Definitions
As used in this chapter, unless the context requires a different meaning:
“Commission” means compensation accruing to a sales representative for payment by a principal, the rate of which is expressed as a percentage of the total dollar amount of orders or sales or as a specified amount per order or per sale.
“Principal” means a person who manufactures, produces, imports or distributes a product for wholesale and who contracts with a sales representative to solicit orders or sales for such product and compensates the sales representative, in whole or in part, by commission.
“Sales representative” means a person other than an employee who contracts with a principal to solicit wholesale orders or sales and who is compensated, in whole or in part, by commission, but shall not include a person who purchases exclusively for his own account for resale.
§ 59.1-456. Contracts between principals and sales representatives
When a principal contracts with a sales representative to solicit wholesale orders within this Commonwealth, such contract shall (i) be in writing, (ii) disclose the method by which the commission is to be computed and paid, (iii) disclose the territory of the sales representative and whether such territory is exclusive, (iv) be signed by the principal and the sales representative, and (v) be provided to the sales representative.
§ 59.1-457. Payment of sales commission
A. Every sales representative shall be paid the earned commission and all other compensation earned or payable in accordance with the terms of the contract.
B. When a contract between a principal and a sales representative is terminated, for any reason, except by mutual agreement, all earned commissions shall be paid within a period specified in the contract, but in no event shall such period exceed thirty days from the date of termination or, in the case of orders processed subsequent to termination, thirty days from shipment. Such commission and other compensation shall be paid to the sales representative at the usual place of payment unless the sales representative requests that the commission be sent to him through regular mail. If the commission is sent through regular mail, it is deemed to have been paid for purposes of this subsection on the date that it is postmarked.
§ 59.1-458. Waiver prohibited
Any provision of any agreement intending to waive the rights of any party to any provision of this chapter shall be void.
§ 59.1-459. Absence of contract not affirmative defense
The failure to execute a contract as required by § 59.1-456 shall not constitute an affirmative defense in any action relating to the provisions of this chapter.
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Wisconsin Sales Rep Statute
Posted: March 10, 2013 Filed under: Wisconsin | Tags: Business, Code of Iowa, Contract, Employment, Independent Contractor, Independent Rep, Manufacture, Rep, Sales, Wage, Wisconsin Leave a commentWisconsin Sales Rep Statute
REGULATION OF TRADE
CHAPTER 134. MISCELLANEOUS TRADE REGULATIONS
Wis. Stat. § 134.93 (2012)
134.93. Payment of commissions to independent sales representatives.
(1) DEFINITIONS.
In this section:
(a) “Commission” means compensation accruing to an independent sales representative for payment by a principal, the rate of which is expressed as a percentage of the dollar amount of orders or sales made by the independent sales representative or as a percentage of the dollar amount of profits generated by the independent sales representative.
(b) “Independent sales representative” means a person, other than an insurance agent or broker, who contracts with a principal to solicit wholesale orders and who is compensated, in whole or in part, by commission. “Independent sales representative” does not include any of the following:
1. A person who places orders or purchases products for the persons own account for resale.
2. A person who is an employee of the principal and whose wages must be paid as required under s. 109.03(3) “Principal” means a sole proprietorship, partnership, joint venture, corporation or other business entity, whether or not having a permanent or fixed place of business in this state, that does all of the following:
1. Manufactures, produces, imports or distributes a product for wholesale.
2. Contracts with an independent sales representative to solicit orders for the product.
3. Compensates the independent sales representative, in whole or in part, by commission.
(2) COMMISSIONS; WHEN DUE.
(a) Subject to pars. (b) and (c), a commission becomes due as provided in the contract between the principal and the independent sales representative.
(b) If there is no written contract between the principal and the independent sales representative, or if the written contract does not provide for when a commission becomes due, or if the written contract is ambiguous or unclear as to when a commission becomes due, a commission becomes due according to the past practice used by the principal and the independent sales representative.
(c) If it cannot be determined under par. (a) or (b) when a commission becomes due, a commission becomes due according to the custom and usage prevalent in this state for the particular industry of the principal and independent sales representative.
(3) NOTICE OF TERMINATION OR CHANGE IN CONTRACT.
Unless otherwise provided in a written contract between a principal and an independent sales representative, a principal shall provide an independent sales representative with at least 90 days prior written notice of any termination, cancellation, nonrenewal or substantial change in the competitive circumstances of the contract between the principal and the independent sales representative.
(4) COMMISSIONS DUE; PAYMENT ON TERMINATION OF CONTRACT.
A principal shall pay an independent sales representative all commissions that are due to the independent sales representative at the time of termination, cancellation or nonrenewal of the contract between the principal and the independent sales representative as required under sub. (2)
(5) CIVIL LIABILITY.
Any principal that violates sub. (2) by failing to pay a commission due to an independent sales representative as required under sub. (2) is liable to the independent sales representative for the amount of the commission due and for exemplary damages of not more than 200% of the amount of the commissions due. In addition, the principal shall pay to the independent sales representative, notwithstanding the limitations specified in s. 799.25 or 814.04, all actual costs, including reasonable actual attorney fees, incurred by the independent sales representative in bringing an action, obtaining a judgment and collecting on a judgment under this subsection.
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Alabama Sales Representative
Posted: March 10, 2013 Filed under: Uncategorized | Tags: Alabama, Business, Code of Iowa, Contract, Employment, Independent Contractor, Independent Rep, Manufacture, Rep, Sales, Wage Leave a commentMICHIE’S ALABAMA CODE ANNOTATED
TITLE 8 Commercial Law and Consumer Protection
CHAPTER 24 Sales Representative’s Commission Contracts
Go to the Alabama Code Archive Directory
Code of Ala. § 8-24-1 (2012)
§ 8-24-1. Definitions.
As used in this chapter, the following terms shall have the following meanings, respectively, unless the context clearly indicates otherwise:
(1) Commission. Compensation accruing to a sales representative for payment by a principal, the rate of which is expressed as a percentage of the dollar amount of certain orders or sales.
(2) Principal. Any person who does all of the following:
a. Engages in the business of manufacturing, producing, importing, or distributing a product or products for sale to customers who purchase the product or products for resale.
b. Utilizes sales representatives to solicit orders for the product or products.
c. Compensates the sales representatives, in whole or in part, by commission.
(3) Sales representative. Any person who engages in the business of soliciting, on behalf of a principal, orders for the purchase at wholesale of the product or products of the principal, but does not include a person who places orders or purchases for his or her own account for resale, or a person engaged in home solicitation sales.
(4) Termination. The end of services performed by the sales representative for the principal, whether by discharge, resignation, or expiration of a contract.
§ 8-24-2. Sales representative’s commission contracts; commission due.
(a) The terms of the contract between the principal and sales representative shall determine when a commission is due.
(b) If the time when the commission is due cannot be determined by a contract between the principal and sales representative, the past practices between the parties shall control, or if there are no past practices, the custom and usage prevalent in this state for the business that is the subject of the relationship between the parties shall control.
(c) All commissions that are due at the time of termination of a contract between a sales representative and principal shall be paid within thirty days after the date of termination. Commissions that become due after the termination date shall be paid within thirty days after the date on which the commissions become due.
§ 8-24-3. Failure to pay commission; damages; attorney’s fees.
A principal who fails to pay a commission as required by Section 8-24-2 is liable to the sales representative in a civil action for three times the damages sustained by the sales representative plus reasonable attorney’s fees and court costs.
§ 8-24-4. Nonresident principal; personal jurisdiction.
A principal who is not a resident of this state and who enters into a contract subject to this chapter is considered to be doing business in this state for purposes of the exercise of personal jurisdiction over the principal.
§ 8-24-5. Waiver void; unrestricted rights or remedies.
(a) This chapter may not be waived, whether by express waiver or by any provision in a contract attempting to make the contract or agreement subject to the laws of another state. A waiver of any provision of this chapter is void.
(b) This chapter does not invalidate or restrict any other right or remedy available to a sales representative or preclude a sales representative from seeking to recover in one action on all claims against a principal.
WordPress Tags: Alabama,Sales,Representative,MICHIE,CODE,TITLE,Commercial,Consumer,Protection,CHAPTER,Commission,Contracts,Archive,Directory,Definitions,meanings,context,Compensation,payment,percentage,dollar,Principal,person,Engages,product,products,sale,customers,Utilizes,Compensates,account,Termination,resignation,expiration,HISTORY,Acts,NOTES,statutes,recovery,DECISIONS,Duck,Head,Apparel,Hoots,LEXIS,Lindy,Twentieth,Century,Mktg,Robin,Pitts,Walter,custom,usage,relationship,Commissions,Cross,references,Interest,Time,limitations,prejudgment,efforts,Taxpayer,Ishler,Comm,Supp,Dist,Internal,Revenue,Failure,attorney,Section,action,Subject,jurisdiction,Corporation,writ,transactions,State,circuit,representation,agreement,controversy,Parte,Tahsin,Indus,Corp,Nonresident,purposes,Waiver,provision,laws,employer,fraud,suppression,statute,plaintiffs,jury,defendant,instruction,objection,error,resale,behalf,whether,commis,sions
Arizona Sales Representative
Posted: March 10, 2013 Filed under: Arizona | Tags: Arizona, Business, Code of Iowa, Contract, Employment, Independent Contractor, Independent Rep, Manufacture, Rep, Sales, Wage Leave a commentARIZONA REVISED STATUTES
TITLE 44. TRADE AND COMMERCE
CHAPTER 11. REGULATIONS CONCERNING PARTICULAR BUSINESSES
ARTICLE 15. SALES REPRESENTATIVE CONTRACTS
Go to the Arizona Code Archive Directory
A.R.S. § 44-1798.01 (2012)
§ 44-1798.01. Sales representative contract
A. The sales representative and the principal shall enter into a written contract. The contract shall set forth the method by which the sales representative’s commission is to be computed and paid.
B. The principal shall provide each sales representative with a signed copy of the contract. The principal shall obtain a signed receipt for the contract from each sales representative.
§ 44-1798.02. Termination of sales representative contract; payment of earned commissions
A. If an agreement of services is terminated for any reason both of the following apply:
1. All the commissions due through the time of termination shall be paid to the sales representative within a period of not to exceed thirty days after termination.
2. All the commissions that become due after the effective date of termination shall be paid to the sales representative within fourteen days after they become due.
B. The principal shall pay the sales representative all commissions due while the business relationship is in effect in accordance with the agreement between the parties.
C. A principal who fails to comply with subsections A and B of this section is liable to the sales representative for damages in the amount of three times the sum of the unpaid commissions owed to the sales representative.
D. The prevailing party in an action brought under this section is entitled to the cost of the suit, including reasonable attorney fees.
E. Commissions shall be paid at the usual place of payment unless the sales representative requests that the com-missions be sent by registered mail. If, in accordance with a request by the sales representative, the sales representative’s commissions are sent by mail, the commissions are deemed to have been paid as of the date of the registered postmark on the envelope.
F. Unless payment is made pursuant to a binding and final written settlement agreement and release, the acceptance by a sales representative of a commission payment from the principal does not constitute a release as to the balance of any commissions claimed due. A full release of all commission claims that is required by a principal as a condition to a partial commission payment is null and void.
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Arkansas Sales Representative
Posted: March 10, 2013 Filed under: Uncategorized | Tags: Arkansas, Business, Code of Iowa, Contract, Employment, Independent Contractor, Independent Rep, Manufacture, Rep, Sales, Salesmanship, Wage Leave a commentArkansas Code of 1987 Annotated Official Edition
© 1987-2012 by the State of Arkansas
All rights reserved.
Title 4 Business and Commercial Law
Subtitle 6. Business Practices
Chapter 70 General Provisions
Subchapter 3 — Sales Representatives
A.C.A. § 4-70-306 (2012)
4-70-301. Definitions.
As used in this subchapter, unless the context otherwise requires:
(1) “Commission” means compensation paid a sales representative by a principal in an amount based on a percentage of the dollar amount of certain orders for, or sales of, the principal’s product;
(2) “Principal” means a person who:
(A) Does not have a permanent or fixed place of business in this state;
(B) Manufactures, produces, imports, or distributes a product for sale to customers who purchase the product for resale;
(C) Uses a sales representative to solicit orders for the product; and
(D) Compensates the sales representative in whole or in part by commission; and
(3) “Sales representative” means a person who solicits on behalf of a principal orders for the purchase at wholesale of the principal’s product. The term “sales representative” does not include a person who places orders for or purchases the product for his or her own account for resale, or is engaged in door-to-door sales regulated by § 4-89-101 et seq.
4-70-302. Sales representatives’ contracts — Limitation.
(a) A contract between a principal and a sales representative under which the sales representative is to solicit wholesale orders within this state must be in writing and set forth the method by which the sales representative’s commission is to be computed and paid.
(b) The principal shall provide the sales representative with a copy of the contract.
(c) A provision in the contract establishing venue for an action arising under the contract in a state other than this state is void.
4-70-303. Payment in absence of contract.
If a compensation agreement between a sales representative and a principal that is not in writing is terminated, the principal shall pay all commissions due the sales representative within thirty (30) working days after the date of the termination.
4-70-304. Jurisdiction.
A principal who is not a resident of this state and who enters into a contract subject to this subchapter is considered to be doing business in this state for purposes of the exercise of personal jurisdiction over the principal.
4-70-305. Waivers prohibited.
A provision of this subchapter may not be waived, whether by express waiver or by attempt to make a contract or agreement subject to the laws of another state. A waiver of a provision of this subchapter is void.
4-70-306. Damages and attorney’s fees.
A principal who fails to comply with a provision of a contract under § 4-70-302 relating to payment of a commission or fails to pay a commission as required by § 4-70-303 is liable to the sales representative in a civil action for three (3) times the damages sustained by the sales representative, plus reasonable attorney’s fees and costs.
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California Sales Representative
Posted: March 10, 2013 Filed under: California | Tags: Business, California, Manufacturing, Sales, Wholesale Leave a commentDeering’s California Codes Annotated
CIVIL CODE
Division 3. Obligations
Part 4. Obligations Arising from Particular Transactions
Title 1A. Independent Wholesale Sales Representatives
GO TO CALIFORNIA CODES ARCHIVE DIRECTORY
Cal Civ Code § 1738.10 (2013)
§ 1738.10. Legislative findings and declarations
The Legislature finds and declares that independent wholesale sales representatives are a key ingredient to the California economy. The Legislature further finds and declares the wholesale sales representatives spend many hours developing their territory in order to properly market their products, and therefore should be provided unique protection from unjust termination of the territorial market areas. Therefore, it is the intent of the Legislature, in enacting this act to provide security and clarify the contractual relations between manufacturers and their nonemployee sales representatives.
§ 1738.11. Citation of chapter
This chapter shall be known and cited as the Independent Wholesale Sales Representatives Contractual Relations Act of 1990.
§ 1738.12. Definitions
For purposes of this chapter the following terms have the following meaning:
(a) “Manufacturer” means any organization engaged in the business of producing, assembling, mining, weaving, importing or by any other method of fabrication, a product tangible or intangible, intended for resale to, or use by the consumers of this state.
(b) “Jobber” means any business organization engaged in the business of purchasing products intended for resale and invoicing to purchasers for resale to, or use by, the consumers of this state.
(c) “Distributor” means any business organization engaged in offering for sale products which are shipped from its inventory, or from goods in transit to its inventory, to purchasers and intended for resale to, or use by the consumers of this state.
(d) “Chargeback” means any deduction taken against the commissions earned by the sales representative which are not required by state or federal law.
(e) “Wholesale sales representative” means any person who contracts with a manufacturer, jobber, or distributor for the purpose of soliciting wholesale orders, is compensated, in whole or part, by commission, but shall not include one who places orders or purchases exclusively for his own account for resale and shall not include one who sells or takes orders for the direct sale of products to the ultimate consumer.
§ 1738.13. Requirement of written contract; Contents
(a) Whenever a manufacturer, jobber, or distributor is engaged in business within this state and uses the services of a wholesale sales representative, who is not an employee of the manufacturer, jobber, or distributor, to solicit wholesale orders at least partially within this state, and the contemplated method of payment involves commissions, the manufacturer, jobber, or distributor shall enter into a written contract with the sales representative.
(b) The written contract shall include all of the following:
(1) The rate and method by which the commission is computed.
(2) The time when commissions will be paid.
(3) The territory assigned to the sales representative.
(4) All exceptions to the assigned territory and customers therein.
(5) What chargebacks will be made against the commissions, if any.
(c) The sales representative and the manufacturer, jobber, or distributor shall each be provided with a signed copy of the written contract and the sales representative shall sign a receipt acknowledging receipt of the signed contract.
(d) The sales representative shall be provided with the following written information and documentation with payment of the commission:
(1) An accounting of the orders for which payment is made, including the customer’s name and invoice number.
(2) The rate of commission on each order.
(3) Information relating to any chargebacks included in the accounting.
(e) No contract shall contain any provision which waives any rights established pursuant to this chapter. Any such waiver is deemed contrary to public policy and void.
§ 1738.14. Doing business in state
A manufacturer, jobber, or distributor who is not a resident of this state, and who enters into a contract regulated by this chapter is deemed to be doing business in this state for purposes of personal jurisdiction.
§ 1738.15. Civil action for damages
A manufacturer, jobber, or distributor who willfully fails to enter into a written contract as required by this chapter or willfully fails to pay commissions as provided in the written contract shall be liable to the sales representative in a civil action for treble the damages proved at trial.
§ 1738.16. Attorney fees and costs
In a civil action brought by the sales representative pursuant to this chapter, the prevailing party shall be entitled to reasonable attorney’s fees and costs in addition to any other recovery.
§ 1738.17. Application of chapter
This chapter shall not apply to any person licensed pursuant to Division 9 (commencing with Section 23000) of the Business and Professions Code.
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Illinois Sales Representative
Posted: March 10, 2013 Filed under: Illinois | Tags: Business, Code of Iowa, Employment, Illinois, Independent Contractor, Independent Rep, Manufacture, Rep, Sales, Wage Leave a commentILLINOIS COMPILED STATUTES ANNOTATED
CHAPTER 820. EMPLOYMENT
WAGES AND HOURS
SALES REPRESENTATIVE ACT
GO TO THE ILLINOIS STATUTES ARCHIVE DIRECTORY
820 ILCS 120/0.01 (2012)
[Prior to 1/1/93 cited as: Ill. Rev. Stat., Ch. 48, para. 2250]
§ 820 ILCS 120/0.01. Short title
Sec. 0.01. Short title. This Act may be cited as the Sales Representative Act.
§ 820 ILCS 120/1. [Terms defined]
Sec. 1. As used in this Act:
(1) “Commission” means compensation accruing to a sales representative for payment by a principal, the rate of which is expressed as a percentage of the dollar amount of orders or sales or as a percentage of the dollar amount of profits.
(2) When a commission becomes due shall be determined in the following manner:
(A) The terms of the contract between the principal and salesperson shall control;
(B) If there is no contract, or if the terms of the contract do not provide when the commission becomes due, or the terms are ambiguous or unclear, the past practice used by the parties shall control;
(C) If neither (A) nor (B) can be used to clearly ascertain when the commission becomes due, the custom and usage prevalent in this State for the parties’ particular industry shall control.
(3) “Principal” means a sole proprietorship, partnership, corporation or other business entity whether or not it has a permanent or fixed place of business in this State and which:
(A) Manufactures, produces, imports, or distributes a product for sale;
(B) Contracts with a sales representative to solicit orders for the product; and
(C) Compensates the sales representative, in whole or in part, by commission.
(4) “Sales representative” means a person who contracts with a principal to solicit orders and who is compensated, in whole or in part, by commission, but shall not include one who places orders or purchases for his own account for resale or one who qualifies as an employee of the principal pursuant to the Illinois Wage Payment and Collection Act [820 ILCS 115/1 et seq.].
§ 820 ILCS 120/2. [Commissions due after termination of contract]
Sec. 2. All commissions due at the time of termination of a contract between a sales representative and principal shall be paid within 13 days of termination, and commissions that become due after termination shall be paid within 13 days of the date on which such commissions become due. Any provision in any contract between a sales representative and principal purporting to waive any of the provisions of this Act shall be void.
§ 820 ILCS 120/3. [Exemplary damages; payment of attorney’s fees and court costs]
Sec. 3. A principal who fails to comply with the provisions of Section 2 [820 ILCS 120/2] concerning timely payment or with any contractual provision concerning timely payment of commissions due upon the termination of the contract with the sales representative, shall be liable in a civil action for exemplary damages in an amount which does not exceed 3 times the amount of the commissions owed to the sales representative. Additionally, such principal shall pay the sales representative’s reasonable attorney’s fees and court costs.
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Independent Contractor (Sales Representative Laws by State)
Posted: October 6, 2010 Filed under: Uncategorized | Tags: Contractor, Independent Rep, Manufacture, Rep, Sales Leave a commentStates where the Sales Representative Law has been declared Unconstitutional.
| STATE | IC LAW | DAMAGES | TIME TO PAY COMMISSIONS | WRITTEN K REQUIRED | CITATION | MISC. |
| Kentucky* | Yes | Commission due plus exemplary damages not to exceed 2 times commissions due plus attorney’s fees & costs. | 30 days | No | Kentucky Revised Statutes, Chapter 371. Sections 371.370-371.375 and 371.380-371.385 | In March 1995, the United States District court for the Western District of Kentucky found Kentucky’s statue unconstitutional under the Commerce Clause and the Equal Protection clause because it imposed additional burdens on manufacturers that did not have a permanent or fixed place of business in Kentucky. Cecil v Duck head Apparel Co., 895 F. Supp. 155 (W.D. Ky. 1995). |
| Florida* | Yes | Commissions plus punitive damages up to twice the commissions plus attorney’s fees | 14 days after termination of the K | Official Florida Statutes, Section 686.201
* |
In September 1992, the Court of Appeals for the third District of Florida held that Florida’s statute “on its face discriminates against interstate commerce by imposing requirements on out-of-state Manufacturers or companies which are not applicable to in-state business.” D.G.D., Inc. V. Jason Berkowitz, 10,115,605 So.2d 496 (Fla. Ct. App. 3d Dist. 1992) |
States without laws concerning payment of Independent Contractor Commissions
Alaska
Connecticut
Delaware
Hawaii
Idaho
Montana
Nevada
New Mexico
North Dakota
Rhode Island
South Dakota
Utah
Vermont
West Virginia
Wyoming
[1] Mfg must maintain copy of signed receipt for the K between Mfg and Rep. Rep can require that commissions be paid by registered mail.
[2] (a) An accounting of the orders for which payment is made, including the customer’s name and invoice number; (b) the rate of commission on each order; and (c) information related to any chargeback’s included in the accounting. No contract can contain a provision waiving any rights established by this statute.
[3] provided the principal is furnished 10 days prior written notice of intent to file civil action for exemplary damages
[4] The notice must include reasons for non-renewal & 60 days must be allowed to correct any deficiencies. There are penalties for non-compliance but they must be settled by arbitration & cannot be pursued in a court of law
[5] The statute lists the requirements of the contract which must be included.
[6] In January 1993, the United States District Court for the Northern District of Texas held that the Texas sales representative statute was unconstitutional on Commerce Clause grounds because it applies exclusively to business with no permanent place of business in Texas. John Havir & Assoc. Inc. V. Tacoa, Inc., 810 F. Supp. 752 (N.D. Texas 1993). In 1995, the statute was amended to address the issues raised by the court decision.
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