The Employer’s Wage and Hour Advisor

Many Michigan companies rely on commissioned sales representatives to develop business and maintain client relationships. However, few know that Michigan has enacted specific laws to protect sales representatives when commission disputes arise. If not handled properly, such disputes can lead to substantial damages. In 1992, the Michigan Legislature passed the Sales Representative Commission Act (the “Act”), which, among other things, provides for treble damages (i.e., three times the actual amount of unpaid commissions, up to a maximum of $100,000.00) if a court determines a company has improperly withheld commissions. Because of these significant penalties, any business using a commission salesforce in Michigan should be aware of the Act’s requirements.