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The Underpaid Banker: Are You Getting The Right Banker Salary and Commission?
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Are you getting the right banker salary and commissions as per law?
The legal inquiries surrounding the banking sector have been widely acknowledged, and recent bank class action lawsuits targeting major players such as Bank of America Corp, Wells Fargo, and JPMorgan Chase Bank have further highlighted dubious practices within the industry.
Moreover, amidst these high-profile developments, a less-publicized concern has come to light: instances of bankers and bank employees experiencing commissions that fall below the legally stipulated standards.
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What You Should Know About Salary and Earning by Commissions in California
A bank employee in California can earn through hourly and fixed wages as salaries and receive additional pay based on commissions, standing out as two of the most common ways to get paid.
Banks must ensure that all employees, including those in various positions within the institution, are paid at least the applicable minimum wage for the hours worked. They are obligated to maintain records of employees’ working hours and cash compensation reports to ensure compliance with minimum wage standards.
Likewise, the payment of commissions to employees must be followed within the specific regulations to safeguard their rights. Time spent on tasks unrelated to earning sales commissions must also be compensated separately at the state’s average salary.
Overtime Pay
Overtime is applicable when an employee works more than 8 hours in a day, exceeds 40 hours in a week, or works over 6 consecutive days in a workweek. The usual overtime rate is 1.5 times the regular hourly pay, referred to as “time and a half.”
However, if an employee works beyond 12 hours in a day or more than 8 hours on the seventh consecutive workday of the week, the overtime rate becomes twice the regular hourly pay.
Certain employees are exempt from overtime requirements, falling under the “generally-exempt” classification. Exempt employees are those not subject to specific wage and hour laws. Employers can claim exemptions only if the employee unequivocally meets the criteria for exemption. To qualify as a generally-exempt employee, the individual must:
- Be salaried,
- Monthly salary range is equivalent to at least twice the state’s minimum wage for full-time employment, and
- Primarily engage in the duties of white-collar professionals (financial and insurance salespersons, bank tellers, personal bankers, and financial advisors), administrators, or executives.
Exemption on Commissioned Sales Employees
California also provides exemptions for certain employees, including those falling under the “commissioned sales” exemption and the “outside salesperson” exemption.
The “commissioned sales” exemption applies to employees who meet specific criteria:
- Earn at least one-and-a-half times the minimum wage.
- Derive more than half of their income from commissions.
- Work in the finance industry or specific professional, technical, clerical, mechanical, or similar occupations.
This exemption is applicable only if both conditions are met within a pay period. If an employee’s earnings fall short of one-and-a-half times the minimum wage during a pay period, overtime compensation must be provided for overtime hours worked in that period.
For outside salespeople who only receive commissions upon customer payment, their exemption status varies based on commission collection. They may be exempt during periods when customers pay for purchases but nonexempt when commissions are not collected.
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Do Bankers Make Commissions?
In California, a commission stands as a form of compensation granted to individuals for the sales-related services they provide. Under a commission-based arrangement, the extent of an employee’s remuneration hinges upon the quantity or value of the item that has been sold. The requirement for these payments are to be given no less than twice per month to the employee.
Typically, the calculation of an employee’s commission is based on either:
- A proportion of the sales proceeds or profits derived from those sales, or
- The total count of sales accomplished.
The General Rule: Secure a Commission Agreement
If a portion or the whole of an employee’s compensation is linked to commissions, the California law requires the compensation arrangement to be documented in writing. This written commission agreement must outline the method for calculating and disbursing your earnings through commissions.
You must also receive a copy of this written commission agreement. The bank is obligated to request the employee’s acknowledgment of receipt, serving as evidence that the employee has been furnished with a copy of the agreement.
If there are changes in the agreement, your employer, in this case, the bank generally retains the authority to introduce a new commission agreement and may stipulate that future employment hinges on the employee’s acceptance of the revised terms.
However, once a commission has been earned based on an existing agreement, you are entitled to receive payment for the earned commission. This right persists regardless of how the new agreement handles commissions that the employee has not yet received.
Unfair Compensation: Uncovering the Issue
The issue of unpaid commissions and unfair wages among California employees takes on a heightened importance, particularly in sectors where these earnings comprise a substantial portion of one’s overall remuneration.
Within the realm of banking, various positions, spanning from loan officers to investment bankers, heavily rely on commissions as an integral component of their comprehensive compensation structure. Banking professionals are engaged in a unique struggle of their own.
Imagine this – investing countless hours in cultivating client relationships, achieving set performance benchmarks, only to confront the disheartening reality that your diligently earned commissions are conspicuously absent from your paycheck!
According to California law, this scenario is illegal and unfair.
Factors Behind Unpaid or Insufficient Banker Commissions
Numerous factors can contribute to situations where commissions remain unpaid or fall short of expectations:
- Payment Delays: Commission disbursement delays can arise from administrative delays or financial constraints within the bank.
- Ambiguities in Commission Agreement: Commission agreements with unclear or subjectively interpretable terms can contribute to disputes.
- Transaction Disputes: Instances of contested transaction validity or reversals can result in the withholding of earned commissions.
- Shifts in Compensation Frameworks: Changes to commission structures by banks can trigger disagreements regarding owed commission amounts.
Can You File Claims for Banker Salary and Commission Rights Violation?
If you believe that your banker salary or commission rights have been violated by a California bank, you have the right to take legal action and get compensation, such as:
- Back pay of unpaid wages and commissions
- Interest on the unpaid amount
- Regulatory sanctions and fines
- Legal expenses if the employee wins the case
So, what can bankers and bank employees do if they aren’t paid enough? They can sue.
Employees can tell the court about their unpaid money by filing a claim or lawsuit against the bank. Doing this could make them get the money they should have been paid before, extra money as a punishment, and payment for other costs connected to the argument about pay.
- Internal Complaint: Employees may initially address their concerns internally by speaking with their supervisor, HR department, or management. Some issues might be resolved at this stage.
- Contact the Labor Commissioner’s Office: If the internal complaint does not yield satisfactory results, the employee can file a wage claim with the California Division of Labor Standards Enforcement (DLSE), also known as the Labor Commissioner’s Office.
- Consult an Attorney: Seeking legal counsel from an experienced employment lawyer is advisable at this stage. An attorney can provide guidance on the best course of action and help the employee prepare their claim.
- Private Lawsuit: In some cases, filing a private lawsuit may be necessary to recover unpaid wages or commissions. An attorney can assist in preparing and filing the lawsuit.
- Class Actions: If multiple employees have faced similar violations, a bank class action lawsuit might be appropriate. This allows a group of employees to collectively seek compensation for the violations.
California employees, including those working in banks, have essential wage and commission rights that must be upheld by employers. Violations of these rights can lead to legal consequences for the banks.
If you believe your rights have been violated, it’s crucial to understand the relevant laws and take appropriate steps to file a claim, either through the Labor Commissioner’s Office or by consulting an employment attorney.
Remember, seeking legal advice is paramount to ensure your rights are protected and you receive the compensation you rightfully deserve.
Why Hire an Employment Lawyer?
Getting an employment lawyer to help with your lawsuit or claim for banker salary and commission violations can offer benefits that greatly increase your chances of success. Employment problems can be complicated and have many different aspects, so having a lawyer with special knowledge and expertise is really important.
Here are some reasons why having a lawyer can be really helpful:
- Expertise – A lawyer who knows a lot about cases involving wage and commission issues will have a deep understanding of the laws, rules, and past cases that are specific to these situations. This knowledge is vital for making a strong argument or claim.
- Navigating complex legal processes – Legal processes for cases about wages and commissions can be tricky and involve a lot of forms and deadlines. A lawyer will guide you through these steps, making sure everything is done correctly and on time.
- Determining liability and evidence gathering – Winning cases about wage and commission problems often depends on having good proof. A lawyer can help gather and keep important proof, like statements from experts, people who saw what happened, reports about what caused things, and records of the harm that was done. This may help determine and prove liability and get maximum compensation you deserve.
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Wage and Commission Violation Lawsuit: FAQs
Who can file a lawsuit?
Bankers who believe they have been subject to wage violations, such as unpaid or underpaid wages, are eligible to initiate a wage lawsuit against banks. This could encompass a range of banker jobs, including but not limited to tellers, loan officers, customer relationship executives, personal bankers, and other roles within the bank.
How much does it cost to file a wage and commission violation lawsuit?
At Labor Law Advocates, our award-winning lawyers work on a contingency fee basis, which means you won’t need to pay a single cent unless we win your case.
We also offer a free, no-obligation consultation.
How long do I have to file a claim for underpaid banker salary and commissions?
Claims related to violations of minimum wage, overtime, unauthorized deductions from pay, or unpaid commissions should be submitted within a period of three years. Similarly, claims rooted in verbal agreements for compensation exceeding the minimum wage should be filed within a two-year timeframe.
We Help Underpaid Bankers File a Case
If you did not receive the banker salary, bonus, or commission you are entitled to, you may be eligible to file a claim and recover compensatory damages.
Labor Law Advocates has employment lawyers who can help you recover financial compensation for any losses related to this wage and commission violation in California.
Do not hesitate! Let us fight for your rights. Call us today for a free, no-obligation consultation. We are available 24/7!
We speak English and Spanish.
