Commissions are a form of compensation paid to employees or independent contractors in exchange for services rendered. Depending on the industry, commissions are calculated as a flat fee, as a percentage of the transaction value, or using a performance benchmark. The actual commission terms are usually detailed in a legally-binding, written contract, although verbal agreements can also be valid and enforceable.
Businesses may choose not to pay commissions, or pay a reduced commission, knowing that litigation could be more expensive for the other party than simply taking the loss. But this strategy fails when you hire The Business Trial Group on a contingency-fee basis. Our contract attorneys have a proven track record of winning commission dispute lawsuits on behalf of real estate agents and brokers, sales representatives, recruiters, and many others.
Unpaid Sales Commissions
Commission structures vary widely and include revenue, gross margin, and tiered. Commission may be earned on a one-time transaction or an ongoing basis. The amount of the commission and the circumstances under which it is earned should be defined in a written agreement.
The Business Trial Group frequently represents sales representatives and sales agents with claims for unpaid commissions. For example, we have represented a yacht broker owed $725,000 as a commission on a $14.5 million yacht, an account executive who was not paid commissions for $8.7 million in book sales, a meat industry consulting firm that had unpaid and underpaid commissions, and a client that sold contracts for a storm damage and recovery company that didn’t honor the terms of their contract.
Time and again, our attorneys have demonstrated a willingness to see unpaid commission cases through to trial. In many cases, our sales commission clients have been able to recover not only 100% of their damages, but also attorneys’ fees.
Unpaid Real Estate Broker Commissions
Real estate agents earn commissions in connection with the sale or purchase of property. Usually, the commission is a percentage of the property’s selling price, but it can also be a flat fee.
The listing agreement is a type of contract that gives the real estate agent or broker the right to sell a property on the owner’s behalf. Listing agreements may give an agent/broker exclusive rights to facilitate a sale, or they can be open, allowing anyone to find a buyer.
Under Florida law, the party who is the procuring cause of a transaction is entitled to a commission. Procuring cause means that the broker initiated an unbroken chain of events that brought the buyer and seller together, and resulted in a deal between them. However, procuring cause can be hotly disputed. And property owners or buyers may use the issue of procuring cause to deny the broker commissions.
The Business Trial Group’s real estate litigation attorneys have helped real estate companies, agents, and brokers recover unpaid commissions in a wide range of disputes, including those involving the breach of an Exclusive Right-to-Sell Listing Agreement, and a real estate broker who allegedly failed to pay two real estate agents.
Unpaid Recruiter Commissions
Finding and hiring top talent is a challenge for companies across industries and occupations. Some companies rely on third-party recruiters to secure talented employees for open positions. When a recruiter submits a candidate to a company and the company hires that candidate, the recruiter is owed a commission, or placement fee.
Recruiters typically charge their clients in one of two ways for finding and placing a candidate: using an upfront, guaranteed fee, or a performance-based fee based on the employee’s first year compensation or production. Industry standards may also apply. For example, executive recruiters are often compensated around 20 – 25% of the candidate’s first year salary.
When recruiters are not paid for their services, they may be able to file a lawsuit to recover unpaid commissions. The Business Trial Group has a history of fighting for—and winning—recruiters’ unpaid fees.
No Written Contract? You May Still Have a Case
While written contracts are the norm, even without one, if you performed the work, you deserve to get paid.
Florida and other states recognize verbal agreements—including “handshake deals”—as legally valid. For example, we’ve handled cases where exchanged emails and text messages confirmed the existence of an oral contract between parties. The specific legal or factual circumstances may also result in a contract being implied.
Contingency-Fees Make Hiring High-Quality Business Attorneys Affordable
Nonpayment of commissions is an all too common issue in the business world. Because capable contract lawyers routinely charge hundreds of dollars per hour, the individual who has not been paid in full may soon find themselves at a disadvantage. They might be forced to forego a lawsuit altogether, or settle their case for a fraction of what it is worth.
The Business Trial Group offers clients a way out of this no-win situation. When we take unpaid commission lawsuits on a contingency-fee basis, our clients pay no retainer or hourly fees, and no fees whatsoever until we successfully resolve the case.
If you did not receive a commission that you are contractually entitled to — whether the contract is written, oral, or implied—our lawyers may be able to help. Learn more during a no-cost, no-obligation case review.