Salespeople are some of the hardest working people in the workforce and some of the most abused. If you can spare 2-3 minutes to read this article, it could be worth thousands of dollars if you determine you are owed overtime.



Many companies are unaware that when they hire sales people to sell their products and services, they must pay their employees overtime when the employee works over 40 within a week. The California overtime law is straightforward and well defined. However, the California overtime law is subjected to misrepresentation. Most employers fail to understand the exempt vs. an employee’s non-exempt status. Unfortunately, there are some employers who take advantage of an employee simply to avoid overtime pay.

Under the California overtime law, an employee can actually sue their employer by filing a lawsuit or file a wage claim with Division of Labor law enforcement. The exempt and non-exempt status is not based on the title assigned to the employee but the nature of the work. Commissioned sales persons are eligible for overtime pay but there are exceptions to the rule.

Calculating Overtime Pay for Sales People

Formula 1: Minimum Wage under California Overtime Law

As a salesperson you must be paid minimum wage for all hours worked. If you are not being paid at least minimum wage regardless of whether or not you sell anything, you are entitled to large penalties and should contact an overtime law attorney at once.

Formula 2: Draw plus commission under California Overtime Law

If you are paid a draw against commission the way you compute your overtime is to take the total weekly compensation and divide it by your total hours. This will give you a base hourly rate. From this you then take this base hourly rate and multiply it time the number of overtime hours (over 8 in a day or 40 in a week) then multiply that figure times .5

This will give you, your commission for that week.

Formula 3: Salary Plus Commission Under California Overtime Law

In this case, you will take your salary and divide by 40 hours which will give you your base pay. Then you will take this figure times 1 ½ multiply time the number of overtime hours. This is your overtime for the week.

If you are not being paid in this fashion in any of the above formulas, you should contact a California Overtime Attorney immediately.



By: Kathleen Armitage