Commissioned salesmen and saleswomen can’t be terminated without good cause and notice.
If you’re a salesperson working on commission in Minnesota, you’ve got rights. First, a manufacturer can’t terminate your sales representative agreement unless it has “good cause.” Good cause basically means that the manufacturer has gone bankrupt, you’ve been convicted of a crime relating to the business, or you’ve abandoned your job.
Even if the wholesaler has good cause to terminate your sales agreement, it needs to give you at least 90 days notice – in writing. The employer needs to state in the notice the reason for termination of the Sales Representative Agreement. And the manufacturer, wholesaler, assembler, or importer needs to give you 60 days to correct whatever reason it’s offering as good cause to terminate the agreement. If – and only if – you don’t correct the reason or deficiency within 60 days can the employer terminate the Sales Rep Agreement.
Sales Representative Agreements automatically renew unless Minneapolis employees get written notice of intent not to renew.
Minnesota law also provides that sales rep agreements automatically renew unless the manufacturer provides written notice of intent not to renew at least 90 days before expiration of the contract. And – if the contract doesn’t have a termination date – then the Minnesota employer has to provide at least 180 days notice to cancel.
You have the right to get all commissions that you earned if you’re terminated.
If you made sales as a commissioned salesperson, you get those commissions even if you’re terminated before the goods actually ship. In fact, you get your commissions for all sales made prior to your termination date or the end of the 90 day notification period, whichever is later. In fact, if you’re terminated, make a written demand for all commissions earned. If your employer doesn’t pay you immediately, then the company will owe a penalty on top of your regular commissions. The penalty is – for every day the employer is late – it owes the salesperson an additional 1/15 of the commissions due, up to 15 days (when it would owe the Minneapolis salesperson double commissions).
If you’ve got unpaid commissions, call us today.
Joshua Newville is a Minnesota employment lawyer, civil rights attorney, and mediator. Josh litigates and advises on such matters as wrongful termination, whistleblowers, discrimination, police misconduct, and more. He offers paid legal consultations and free online case reviews regarding employment law and civil rights.