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Getting fired is difficult enough. Finding out that a commission or bonus you were expecting is missing from your final pay can make the situation even more frustrating.
Maybe you closed a major sale weeks before your termination. Perhaps you hit the performance goals required for a year-end bonus. Now your former employer says you are not entitled to the money because you were no longer employed on the scheduled payment date.
In Missouri, whether you are still owed a commission or bonus after being fired often depends on one important question: Had you already earned the compensation before your employment ended?
When Is a Commission or Bonus Considered Earned?
The date a company planned to issue a payment is not necessarily the same as the date you earned it.
For example, a salesperson may close a deal in October, but the company’s commission schedule may not provide payment until December. If the employee is terminated in November, the employer may argue that no commission is due because the employee was no longer working there on the payout date.
Whether that argument holds up can depend on the compensation agreement, the type of payment involved, and Missouri law.
Written commission plans, employment agreements, offer letters, emails, and other documents can help establish what an employee had to do to earn the compensation. If you completed those requirements before being fired, you may have a stronger argument that the money was already earned.
Are Commissions and Bonuses Treated Differently in Missouri?
Commissions and bonuses are not always treated the same.
Certain sales representatives may receive specific protections under Missouri law for earned commissions. Depending on the circumstances, an employer may still be required to pay commissions earned before termination or due afterward.
Bonuses can be more complicated.
A bonus tied to specific, measurable requirements, such as meeting a sales quota or completing a project, may be treated differently from a purely discretionary bonus. If an employer retains complete discretion over whether to award a bonus, an employee may have a more difficult time establishing a right to payment.
The language of the compensation plan matters. Provisions requiring an employee to remain employed through the payout date can also affect the analysis, although such provisions do not necessarily eliminate every right an employee may have to earned compensation.
What If You Were Fired Right Before a Large Commission Was Due?
The timing of a termination can raise additional questions.
Missouri generally follows the at-will employment doctrine, meaning employers have broad authority to terminate employment. That does not necessarily give an employer the right to avoid paying compensation an employee has already legally earned.
Consider an employee who consistently performs well, closes a large deal, and is suddenly terminated days before a substantial commission becomes payable. If the employer then refuses to pay the commission, the circumstances may warrant a closer look.
Other potential warning signs can include shifting explanations for the termination, a sudden departure from normal disciplinary procedures, or an employer changing its interpretation of the commission plan only after the employee is terminated.
What Evidence Can Help With an Unpaid Commission or Bonus Claim?
Documentation can be critical when there is a dispute over compensation.
Employees may have records such as employment agreements, offer letters, commission plans, bonus plans, pay stubs, sales reports, or emails discussing compensation. Records showing that a sale closed, a target was reached, or another required condition was satisfied may also help establish when the compensation was earned.
It is also helpful to document what the employer said about the unpaid money after termination. An employer’s explanation may become important if the dispute develops into an unpaid wage, commission, or contract claim.
What Should You Do If Your Former Employer Will Not Pay?
Missouri has laws addressing unpaid wages and certain unpaid commissions. The remedies and requirements can vary depending on the type of compensation and the employee’s circumstances.
That makes it important to determine exactly how the commission or bonus was structured rather than assuming that termination automatically means the money is lost.
Sedey Harper Westhoff has more than 40 years of experience representing individuals in employment disputes. If you were fired before receiving a commission or bonus you believe you already earned, our employment attorneys can review your compensation documents and help you understand your options under Missouri law.