Wage, Bonus, Commission and Benefit problems

Things to consider if your employer is not paying you properly

Let’s assume the employer’s motive is not some form of Discrimination or Retaliation, and that he is not trying to force you to quit (which we call Constructive Discharge). Assume you do not have a written employment Contract, and do not have a Non-Compete Agreement, and you have not been given a Separation-Severance-Waiver-of-rights Agreement upon being terminated. No other problems are occurring, in our assumption, and the law of Wrongful Termination will not be playing any role in our analysis.

But if any of the above circumstances might apply to you, then your problem potentially goes way beyond mere unpaid wages, bonuses, commissions or benefits, and you should consider seeing a lawyer right away. FYI: Problems with payments and benefits are sometimes part of a pattern of unfair treatment, such as I talk about in my Hostile Environment and Constructive-Discharge articles. The pattern may or may not give you rights, but it’s suspect and needs to be explored.

Regarding Benefit Problems – LIMITATIONS OF THIS ARTICLE

For Benefit Problems, a key distinction is between “ERISA Benefits” and “Non-ERISA Benefits”. For more information about ERISA, see my brief article called Benefit Summary: ERISA, HIPAA, COBRA, MO Continuation. ERISA benefits are the big benefits, such as health plans and pension plans, of companies that meet the complicated standards for being large enough for ERISA to apply to them.

But most miscellaneous benefits are not going to be official ERISA plans, and disputes about those benefits do not trigger any special rights under the ERISA laws.

NOTE THIS MAJOR LIMITATION: I do not cover insurance or health plan benefit payment problems at all in this article, such as the carrier not paying your claims or denying coverage. I do not want to discuss coverage issues in this article – that’s too complex a topic.

Missouri law is very, very deficient about pay and benefit disputes

I talk more about the lack of protections in Missouri for resolving wage and benefit problems in my article listing many of the employment law deficiencies affecting Missouri residents, which I call The Sorry State of our employment protections. Generally, if the employer cheats you out of some of your pay and Non-ERISA benefits, you’ll probably end up in small claims court unless the amount is high enough to pay a decent contingency fee if you win. But read on, and don’t jump to conclusions just yet. There is some hope.

Here are simple payment and benefit problems where the info in this article may help:

Commission disputes:

If you are being cheated out of commissions, look to two sources for special rights — First, look to your Employment Contract for special rights, if any. Second, look to the Merchandising Practices Act, and I talk a little bit about this in my article on Unpaid Commissions.

Simple benefit disputes:

Here’s the most common type of Non-ERISA benefit problem I get calls about: Unpaid vacation and sick pay. I wrote a short article about the problem, Vacation and Sick Pay.

I also get calls about disputes surrounding miscelleous things like: Moving allowances, tuition reimbursement, expense report reconciliation, car allowances, cell phone bills, cash-in-lieu-of-some-benefit.

Simple underpaid wages, salary, tips, bonuses, commissions:

Read on if you are being cheated out of hourly or weekly wages or salary (including tips), or bonuses, or commissions, or miscellaneous benefits. Remember: if you have an Employment Contract you may have special rights.

BUT: Watch out for unpaid overtime or unpaid final wages:

• If the employer is cheating you out of overtime pay, then see my Overtime – Comp Time article.
• If the employer is cheating you out of your final wages, and you were fired from the job or allegedly layed off, then see my  unpaid final wages  article.

Here are the most common reasons for disputes about payment of some of your wages, bonuses or commissions or non-ERISA benefits:

• Cash flow problems – the employer lacks the money right now
• A legitimate disagreement exists about how much you are supposed to be receiving
• You owe the employer money, he says, and so he won’t pay something that he owes you
• The employer is trying to save a little money by shaving your pay a bit
• You got a big order and the employer doesn’t want to honor his commission agreement
• The employer feels you used up your sick time or vacation time, but you disagree
• The employer feels, right or wrong, that you are not entitled to the benfit or reimbursement, etc
• (more rarely) The employer is trying to force you to quit, as part of what the law calls Constructive Discharge

Dealing with common simple payment or benefit disputes:

• Did you actually get paid enough to equal or exceed the “minimum wage” even if the employer failed to pay the remaining portion of your wages? If so, then you will probably have to file a small claims court action for the remaining unpaid wages. Try these links for some general public info about the small claims court process:   St. Louis County Circuit Clerk’s website – see the Clerk’s FAQ for some small claims court info;  
  Missouri Bar Association Mobar has Public Info Brochures on various legal topics;   Bar Association of Metro St. Louis (BAMSL) BAMSL has public information brochures.
• If you DID NOT actually get paid enough to equal or exceed the “minimum wage” then this may violate the Federal and State Wage and Hour Laws. If the employer has truly cheated you out of wages, or taken improper deductions, and thereby reduced your wages to below the level of the Minimum Wage, then the law might be able to help.
  • Here is the Federal Department of Labor’s (DOL’s) Minimum Wage Page.
  • For free you can file a complaint immediately with the Federal Department of Labor (DOL) and the Missouri Department of Labor and Industrial Relations (LIRC).
  • But expect a legal battle over whether the employer’s deductions were legitimate. The law generally permits legitimate deductions even if those deductions reduce your gross pay to below the minimum wage.
  • FYI: For some categories of workers, such as certain computer workers, the government sets different minimum wages for other reasons. For example, some computer professionals are allowed to be “exempt” only if they are paid a certain minimum rate. So, if the employer cheats a computer professional out of some of his wages, the professional might lose his “exemption” status and the employer would then be on the hook for perhaps massive amounts of Overtime pay. It gets very complicated at times.
• Did your paycheck bounce? Call the DOL and/or the LIRC, as linked-to above. They might help you promptly. Call the Prosecuting Attorney in the county where you live and see if the Prosecutor’s Office has a procedure to send a Notice to the person who bounced the check. Lawyers are not too excited about bounced check cases, because the employer is obviously having cash flow problems and may even be on the verge of bankruptcy and unable to pay a judgment. But the government is usually willing to help you if you file a prompt complaint.
• OFFSETS: If you owe the employer money, the law generally permits him to withhold your wages in payment of amounts due. The usual dispute I see involves an employer who claims the employee owes him money, such as for damage to a vehicle, or to pay back a cash register shortage. But there is no documentation that the employee ever agreed to assume the liability for such “debts” in the first place, and so the employee feels cheated when the employer begins taking money out of his check. The employee is being cheated, in my opinion, unless the employee expressly agreed, in advance, to be responsible to pay back such expenses. Unfortunately, Missouri law does not discourage employers from engaging in this kind of conduct. But if you legitimately owe the employer a debt, the law permits collection through withholding of your wages, including withholding of your final wages.
• Small Claims Court – That’s the place most of the simple payment and benefit disputes are going to end up, because the dollar amount is not high enough to attract a contingency fee lawyer, and the dollar amount is too low to justify you paying a big fee to a lawyer to help you.
• The larger the disputed amount is, the more likely it is that you can attract a lawyer to assist you.
• For more general information, visit Missouri Department of Labor Industrial Relations Frequently Asked Questions page.

Missouri law is deficient

There is no provision in Missouri law for imposing any kind of penalty on the employer for not paying a part of your ordinary wages, as long as he is actually giving you at least enough to equal the minimum wage. Even if you take him to court and win, all he’ll owe you is the amount of the wages. He won’t even have to pay any attorney fees you incurred in beating him. If he is cheating you out of a significant amount of money it might be worthwhile to sue. Call a lawyer. See my contracts article for more information, because an action for underpaid wages is a contracts case.

Please consider calling or writing your Missouri State Representative or State Senator and tell them if you think Missouri should have a Wage Payment and Collection Act to help fix the problem of employers cheating employees out of their pay.   Find out the name and address of your Missouri state senator, and Find out the name and address of your Missouri state representative here.   FYI: Illinois has a very nice law, called the Illinois Wage Payment and Collection Act which gives you a special right to sue when the employer cheats you out of your pay or benefits. You can win damages and attorney fees in Illinois for this kind of misconduct by employers, but Missouri law doesn’t seem to care.

But once again, you have special rights if the company is not paying Overtime, or if you have Unpaid Final Wages, or Unpaid Commissions.

Remember: If you got fired or layed off, and the employer failed to hand you your final pay on the spot, he violated the law and you can trigger a penalty. See my Unpaid Final Wages article for more details.

See also The Sorry State of our employment protections for more about the lack of protections for employees cheated out of pay and Non-ERISA benefits.

Article written by | Tim Willoughby