Salary + Commission - Minimum Wage?

[grandmah]

What is the name of your state (only U.S. law)? Colorado

I just started with a new company and they pay a field inspector base pay + commission. He does some sales but they might make up 25% of his job. His base pay is $1500 a month and his commission is averaging $2500 per month. His base pay does not meet minimum wage. Does that matter since his commission more than makes up for that?

I tried to call the Colorado dept of Labor but they close at noon on Thursdays and wont answer questions today. Unfortunately this employees review is tomorrow morning at 8am and he's questioning the minimum wage rule.

Any idea?

 

[Zigner]

in June of 2014 ( https://forum.freeadvice.com/child-custody-visitation-37/rights-unmarried-mother-baby-606759.html ) you were an unmarried mother. Has something changed with you since then?

 

[grandmah]

in June of 2014 ( https://forum.freeadvice.com/child-custody-visitation-37/rights-unmarried-mother-baby-606759.html ) you were an unmarried mother. Has something changed with you since then?

What does that have to do with my post?

 

[Zigner]

What does that have to do with my post?

Please have the involved party log on to discuss his own issues. Thank you.

 

[LdiJ]

What is the name of your state (only U.S. law)? Colorado

I just started with a new company and they pay a field inspector base pay + commission. He does some sales but they might make up 25% of his job. His base pay is $1500 a month and his commission is averaging $2500 per month. His base pay does not meet minimum wage. Does that matter since his commission more than makes up for that?

I tried to call the Colorado dept of Labor but they close at noon on Thursdays and wont answer questions today. Unfortunately this employees review is tomorrow morning at 8am and he's questioning the minimum wage rule.

Any idea?

It is perfectly acceptable to have a base salary that is below minimum wage as long as the employee consistently has enough total pay (W2 pay not 1099 pay) to bring them above minimum wage.

However, if the employee really makes a stink about it, and consistently has enough commission to bring them above minimum wage, you can simply increase the base pay and reduce the commission so that they make the same amount of money, but its divided differently.

 

[Zigner]

It is perfectly acceptable to have a base salary that is below minimum wage as long as the employee consistently has enough total pay (W2 pay not 1099 pay) to bring them above minimum wage.

However, if the employee really makes a stink about it, and consistently has enough commission to bring them above minimum wage, you can simply increase the base pay and reduce the commission so that they make the same amount of money, but its divided differently.

Of course, they could just fire him for being an uncalled for thorn in their side.

 

[LdiJ]

Of course, they could just fire him for being an uncalled for thorn in their side.

He is not necessarily in the wrong though. The OP said that he averaged 2500.00 a month in commission but that does not mean that the commissions are consistently enough to bring him above minimum wage. That is why I emphasized "consistently". If he is below minimum wage for a pay period that would be a problem.

 

[grandmah]

It is perfectly acceptable to have a base salary that is below minimum wage as long as the employee consistently has enough total pay (W2 pay not 1099 pay) to bring them above minimum wage.

However, if the employee really makes a stink about it, and consistently has enough commission to bring them above minimum wage, you can simply increase the base pay and reduce the commission so that they make the same amount of money, but its divided differently.

Thank you. I want to be fair to this employee and make sure the company is meeting labor laws. I've been doing Payroll for 8 years and never ran into this question before.

 

[Zigner]

Thank you. I want to be fair to this employee and make sure the company is meeting labor laws. I've been doing Payroll for 8 years and never ran into this question before.

I see now that I totally misinterpreted your original post. My apologies. I didn't realize that you were an employer representative...I thought you were writing about your significant other.

 

[grandmah]

I see now that I totally misinterpreted your original post. My apologies. I didn't realize that you were an employer representative...I thought you were writing about your significant other.

No problem at all. I should have said I was the HR department.

 

[cbg]

What LdiJ said.