Commissions - The Maryland Guide to Wage Payment and Employment Standards

Commissioned sales agreements between an employee and employer are generally enforceable contracts. Where an employee completes the specified services on a sale or account, and the transaction is finalized through settlement, delivery and payment, the commission is usually payable unless a reasonable -- but not excessive -- lag time is agreed to in the event of customer return or default.

Where a commission is paid in advance of receipt of payment from the customer, but no provision in an agreement between the parties provides for a refund to the employer of commissions paid, no deduction may be made from the future wage of the commissioned employee in the event of customer return or default.

Unconditional agreements to forgo commissions upon termination of employment are unenforceable to the extent all required services necessary to claim the commission were completed by the employee prior to termination.

Updated February 18, 2010