Advice needed please! Bonus Withdrawal

[Adamyoung10910]

Hi there,

I look after a Retail company’s website and am responsible and accountable for the level of Sales. I earn 18K per annum.

In October 2010 i requested a pay rise after 7 years of no increase, and was told would not be able to receive an increase in base pay but if i overachieved on set net monthly targets i can earn 5% of all over target sales. Obviously if I underachieve one month i will have to make this back up the next month to ‘qualify’ for my bonus. My bonus is paid one month in arrears. I received an email detailing this information, however never signed an contract as such.

After the first month I struggled to achieve target and had a £5K shortfall - so i got no reward.
The month after in November i was £4K over – however due to my shortfall in Dec there was no reward.
In December i was £7K over and was rewarded with my 5% bonus for over target sales. (about £300)
In Jan and Feb i again achieved over target and got my 5% reward.
March and April i had a shortfall so no bonus.
In May i smashed my target and was rewarded the agreed 5% (about £800)
In June i did even better and earned £2500 to be paid into my July pay.

And 3 weeks into July 2010 just before i am due to get paid i am told by my employers that this cannot carry on as the bonus structure in place is too high.

In July i was paid £500 and in August £712 – This equated to just 50% of my June Bonus only.

In September and October i received no bonus even though i have continued to over achieve my set targets for the year.

As it stands i am ‘owed’ £5700 in unpaid bonuses by the company and the subject has been avoided by management and dealt with very unprofessionally where no one can give me answers. I have arranged a meeting with the MD next week.

I have been told they will settle the amount outstanding by offering 0.25% of all Sales turnover for the outstanding months – this equates to approx £500, around 9%. Obviously i am unhappy with this.

My question is this please... where do i and the company stand legally with this matter.

I feel like i have been let down here and penalised for all my over achievements and efforts. Please note that the company only addressed this when it became in late July at communication on the matter has been very little.

What should i do....Please help!!!

 

[Adamyoung10910]

Should I just accept this will not be paid?? Or try and negotiate an agreeable amount??

I can provide more info if needed.

Any response would be helpful please to know where i stand. Thank you.

 

[mhall]

Tricky one- you have a contract with your employer and they should abide by it. If they don't you are perfectly within your rights to terminate the contract and sue them for payments owed.

You will, however, be out of a job.

From the sound of it, they didn't expect you to be so succesful and now want the money for themselves. Personally I'd find another job pronto and then sue them. I certainly wouldn't agree a lesser amount and would be looking to stretch the whole matter as long as I could while I found another job.

 

[Business News]

Talk to ACAS - you may have grounds for constructive dismissal if you have proof of the bonus payouts that represent a high ratio of your total remuneration that has now been withdrawn without explination. You need to move fast on it though as walking out 3 months after the change may lessen the impact towards a constructive dismissal claim.

 

[Adamyoung10910]

Really appreciate your replies – very helpful.

I spoke with ACAS and they said i had a very strong claim for deferral of wages and suggested I request in writing that the outstanding amount is paid in full giving them 2 weeks before making an ET1 Employment Tribunal Claim against my employers.

Am I ruffling too many feathers by doing this, would my employers have grounds to dismiss me if I go down this route?? I don’t want to lose my job.

I have a meeting next Thursday with the Partner/MD, how should I approach this?

 

[MH1]

If you push too hard although you will probably win you might find yourself out of a job, either through missing new targets or redundancy, your employer might not be the forgiving type.

The only advice I can offer is to talk to your employer and try to see their possible attitude before laying down demands, mention the previous deal and ask why the company feels unable to honor the agreement, and maybe reach a compromise, ie lower overall payout but better than that currently on offer in the future, ie 1-2%.

 

[sjbeale]

They owe you the money and should pay you in full. You need to assert this during the meeting. Take some notes of what is said during that meeting. If they don't agree to pay you will have to lodge an employment tribunal claim.

If they sack you for doing so you can add unfair dismissal to that claim.

If you need help with a claim please email me [email protected] as I represent claimants in employment tribunals.

 

[captaincloser]

I am not a lawyer I am a salesman so tread carefully with this advice.

Your problem is not uncommon. In the trade (sales) it's known as being 'shafted'.

What I would do in your position is approach the meeting with anything including emails printed out. Suggest to the partner that you have taken advice and will be quite happy to pursue payment. Say that quitely as a dignified approach to shafters often does the trick. Say as little as possible and on no acount get excited, rude or submissive.Stay cool.

What is involved here is greed.They made an agreement and you are delivering and over delivering .They now want to renage on the agreement and shaft you for the commission owed.

Do not worry too much about things going against you. Having been in your position a long time ago I can assure you of one thing.If you are not paid or accept a lower payment the eventual knock-on effect on you will prevent you from working properly for them again.

Its about a breakdown of trust and as I say, greed. Be dignified but be prepared to do the same to them as they are doing to you...which I did with significant consequences for the company concerned.

Good luck.

 

[kulture]

All good general advice. What no one here can do is give you specific advice as we do not know the details. I once worked out a commission structure that seemed fair and was about to impliment it when I did one last costing.it worked out that I could not afford it. That it would give cash flow problems and if honoured it could close the company. For all we know this may not be greed, it may simply be that they worked it out wrong in the first place.

 

[captaincloser]

All good general advice. What no one here can do is give you specific advice as we do not know the details. I once worked out a commission structure that seemed fair and was about to impliment it when I did one last costing.it worked out that I could not afford it. For all we know this may not be greed, it may simply be that they worked it out wrong in the first place.

You are correct Kulture...but it is very rare that this might happen...a bit like being short changed...it rarely seems to happen the other way round.

Typically anyone I have ever worked with has been delighted to pay me more and more money...but looking at this one it appears a threshold needs to be hit before the bonus commission kicks in so I dont see how they have miscalculated..? Even if they have miscalculated, it would appear they have not really handled this situation at all well if the OP is correct? He is probably a gonner as far as working for them is concerned whatever he may feel today.

 

[MH1]

In the trade (sales) it's known as being 'shafted'.

All salesmen have unfortunately experienced this part of the relationship with an employer, too often.

I joined a company 15 years ago, everyone was happy with the commission structure, and I mentioned when being taken on they would become very wealthy, and everything would be great until "that day." The owner looked puzzled and asked what "that day" meant, and I painted the picture of a year or two down the line when he would be a millionaire and become greedy, and decide his salespeople didn't need to earn as well as they had done, and he would propose a "new deal, a better commission structure" which would result in him losing the good performers.

He stated this would not happen, 18 months later he made the call to visit and proposed a new commission structure. He and his three partners were all now millionaires, but had decided they didn't need their best salespeople earning £60-80k PA. I reminded him of my warning, he stated the new commission structure was non negotiable, and myself and his three other main guys promptly left with 80% of his workforce to a competitor, all of us were on commission only.

It took myself three hours to get a better deal than my guys were previously enjoying, no-one had wanted to leave, it took my previous employers company just four months to go into administration, too many office staff with suddenly very few sales coming in.

 

[captaincloser]

All salesmen have unfortunately experienced this part of the relationship with an employer, too often.

I joined a company 15 years ago, everyone was happy with the commission structure, and I mentioned when being taken on they would become very wealthy, and everything would be great until "that day." The owner looked puzzled and asked what "that day" meant, and I painted the picture of a year or two down the line when he would be a millionaire and become greedy

It took myself three hours to get a better deal than my guys were previously enjoying, no-one had wanted to leave, it took my previous employers company just four months to go into administration, too many office staff with suddenly very few sales coming in.

Mr MH1 ...you have stolen my story but I am very pleased to see you have.
I know umpteen instances like this...human nature is soooo interesting..it's weird being in sales for so long..you just know what is going to happen so long before it ever happens..(that's if you are any good). As I often say..the lifetime of a good salesman in most outfits is as predictable as night following day.

 

[patientlady]

Hi Adam
Get your money owed from them and get a new job! You will not be able to earn anymore commission no matter what the structure is.
Adam not sure what your selling, but a good salesperson will never be un-employed

 

[mhall]

but a good salesperson will never be un-employed

But Sales Directors will be - stay in sales and avoid promotion

 

[patientlady]

But Sales Directors will be - stay in sales and avoid promotion

you are so right!

 

[Zahra]

What I want to know are where are all these sales people who work for commission and make everyone rich?? How do I find them?