Employer wants to change my contract to commission only!

SarEl

Best laugh I have had all day "creative dismissal" For that you win - legal advice. Do not resign no matter how hard you are pushed. Write to the employer and tell them that you refuse to accept the change (and put what the change is in the letter) and expect your existing terms and conditions to be honoured. That should be enough for them to sack you, in which case you do have a good case for unfair dismissal. If they don't, and try to enforce the change, then do it again - refuse in writing. They will still sack you. Alternatively they may simply change your pay (which they can't in law do) - in which case you make a tribunal claim for breach of contract and unlawful deductions of wage. And then they will sack you. I am sure you are getting the theme here! But you never ever resign. Force them to sack you.

And by the way - it's constructive dismissal, and you do not want to claim this becasue even with great evidence, they are very hard to win.

emilyteach1

bengalknights wrote: »

they have to give you a minimum wage by law

Hi,

I'm just wondering out of interest, if the employer does change the contract to commission only, but the OP's commission exceeds the minimum wage, what's the law on this, does anyone know?

Just curious.

SarEl

emilyteach1 wrote: »

Hi,

I'm just wondering out of interest, if the employer does change the contract to commission only, but the OP's commission exceeds the minimum wage, what's the law on this, does anyone know?

Just curious.

Yes, as you obviously suspect - if the commission exceeds the NMW then this is lawful, but if it doesn't the employer must make it up to the NMW. But that doesn't change the fact that the employer cannot simply change a contract in this way without legal consequences. The issue here is the change of contract, rather than the NMW or the commission.

bap98189

bengalknights wrote: »

they have to give you a minimum wage by law

Not necessarily. When times get tough, it is commonplace for a company to ask sales staff to go onto commission only. They are then treated not as employees, but as self-employed agents. Of course the company has to make them redundant and pay redundancy accordingly.

Sometimes sales staff will voluntarily waive redundancy payments, but you would have to be very confident of being able to earn a lot of commission to agree to that. Generally a higher commission rate will be agreed, because obviously the staff are no longer receiving the base salary.

But the important part is that the company cannot do this unless you agree to it.

lynzpower

bap98189 wrote: »

Not necessarily. When times get tough, it is commonplace for a company to ask sales staff to go onto commission only. They are then treated not as employees, but as self-employed agents. Of course the company has to make them redundant and pay redundancy accordingly.

Sometimes sales staff will voluntarily waive redundancy payments, but you would have to be very confident of being able to earn a lot of commission to agree to that. Generally a higher commission rate will be agreed, because obviously the staff are no longer receiving the base salary.

But the important part is that the company cannot do this unless you agree to it.

No, that isnt true.

I phoned both acas and the direct.gov minimum wage helpline on this issue only last week.

If a job is advertised as commission only, thats fine, but if the commission does not meet the minimum wage after tax then the employer MUST make the difference up

If the commission exceeds minimum wage then the employer needs to do nothing.

The minimum wage helpline was very clear on this point to me last week.

bap98189

lynzpower wrote: »

No, that isnt true.

I phoned both acas and the direct.gov minimum wage helpline on this issue only last week.

If a job is advertised as commission only, thats fine, but if the commission does not meet the minimum wage after tax then the employer MUST make the difference up

If the commission exceeds minimum wage then the employer needs to do nothing.

The minimum wage helpline was very clear on this point to me last week.

I think you are missing the point. They no longer have a job. You make the staff redundant, then they are no longer employees. If they continue to sell your stuff on a commission basis, they are self-employed and not paid through PAYE, but via invoice. What hours they work is then up to them. I know a number of people in this position who work in sales.

SarEl

lynzpower wrote: »

No, that isnt true.

I phoned both acas and the direct.gov minimum wage helpline on this issue only last week.

If a job is advertised as commission only, thats fine, but if the commission does not meet the minimum wage after tax then the employer MUST make the difference up

If the commission exceeds minimum wage then the employer needs to do nothing.

The minimum wage helpline was very clear on this point to me last week.

Actually, that isn't entirely true either! The NMW does not apply to self-employed people. The actual test is whether the person is genuinely self-employed or not, and in most cases doing as the poster suggested - making staff redundant, taking them back on as self-employed, and the tests of self-employment would not be fulfilled making this an unfair dismissal. A number of these "commision-only" employments have been tested in law and they often do not comply with the requirements for self-employment, making the people employees. The reason why so many employers still get away with it is because their workers are too ignorant of the law or too cowed to challenge it.

SarEl

bap98189 wrote: »

I think you are missing the point. They no longer have a job. You make the staff redundant, then they are no longer employees. If they continue to sell your stuff on a commission basis, they are self-employed and not paid through PAYE, but via invoice. What hours they work is then up to them. I know a number of people in this position who work in sales.

You may know a number of people who do this. But whether it has been set up in accordance with the law is an entirely different matter.

bap98189

SarEl wrote: »

You may know a number of people who do this. But whether it has been set up in accordance with the law is an entirely different matter.

I'm not an expert, but two of them worked for a FTSE 500 company, so I would expect everything has been done legally.

I don't see how it can be illegal. If you are running your own business, minimum wage doesn't come into it.

lynzpower

Sorry yes. I misread this. I didnt realise that the OPs employer is trying to make him self employed.