In the News: Chris Deubert Explains What the Steelers Wage Case Means for Commission-Based Employees 

Constangy attorney Chris Deubert authored an article for HR.com analyzing a federal court ruling that allows a former Pittsburgh Steelers employee’s wage claim to move forward and what it signals for employers that use commission and bonus plans.  

Chris explained that on Aug. 5, the U.S. District Court for the Western District of Pennsylvania denied the Steelers’ motion to dismiss a claim under Pennsylvania’s Wage Payment and Collection Law. The former corporate partnership sales manager, Chelsea Zahn, alleges she generated $1.81 million in sponsorship revenue but received $50,000 instead of the $100,625 she says she was owed. The court found that her offer letter, which described a discretionary bonus, plausibly created an express contractual right and that any discretion must be exercised in good faith. It also found that her allegations plausibly pleaded an oral contract to pay the full bonus. 

“As the Steelers case demonstrates, failing to think through and memorialize these policies can result in confusion and litigation,” said Chris.

According to Chris, employers should clearly define when commissions are earned, how they are calculated, when they are paid and how discretionary decisions are made. He advised that commission structures be set out in a written policy, provided to employees when they join and reviewed with them at least annually. He also recommended that employers consider arbitration agreements and stay mindful of state laws on when commissions are earned and must be paid.  

To view the full article, you may click here.