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Commissioned Employees Are Entitled to Paid Rest Breaks

March 27, 2017 by

A California court of appeal has ruled that commission-paid employees are entitled to no less than pay at the legally applicable minimum hourly wage rate for state-mandated rest breaks.

California’s Labor Code and Wage Orders provide that employees are entitled to take a ten minute paid rest break for every four hours worked, whether the employee is paid by the hour, piece-rate, or by commission. This requirement is relatively straightforward if you are paid by the hour, but the law has been unclear for workers paid by commission. Commission pay schemes are typically based on a percentage of sales and not on the number of hours worked, so the commission does not include any pay for rest breaks. So how does a commissioned employee get a paid break if he or she only gets paid for sales? A California Court of Appeals recently answered this question by ruling that commissioned employees are equally entitled as hourly employees to take a paid rest break. (Vaquero v. Stoneledge Furniture LLC, CA2/7 B269657 2/28/17.) The Court found that compensation plans that do not compensate employees directly for rest periods undermine California’s protective policy by discouraging employees from taking their rest breaks. Therefore, an employer’s compensation scheme that pays the same regardless of whether or not an employee takes a rest break is unlawful. As a result of this decision, Employers with commission-based compensation must separately account for, and pay no less than the minimum wage, for rest periods to comply with California law.


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