Employers May Not Average Commission Payments Over Certain Pay Periods.

Plaintiff is a commissioned salesperson who received biweekly paychecks, which included hourly wages in every pay period and commission wages approximated every other pay period. After plaintiff’s wage and hour action against her employer was removed to federal court and made it to the appeal stage, the Ninth Circuit requested the California Supreme Court to answer a question about averaging an employee’s commission payments over certain pay periods when it is equitable and reasonable for the employer to do so. The California Supreme Court said no, it was not consistent with California’s compensation requirements. (Peabody v. Time Warner Cable, Inc. (Cal. Sup. Ct.; July 14, 2014) 59 Cal.4th 662, [328 P.3d 1028, 174 Cal.Rptr.3d 287].)