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Lucy_Cohlburn's avatar

1099 Commission Refunds: Poor Product?

Asked by Lucy_Cohlburn (4points) August 29th, 2014

I work as a 1099 contracted salesman for a custom/specialized sportswear company. The products can take 2–3 months to create and ship out. Recently, our products have been having some quality control issues to the point that customers are returning their custom apparel back to our company and commissions are being taken back. As my contract states, I am to ‘procure sales’ within my territory.

The only other part of my contact that says anything else related to this subject reads “Salesmen earn 10% commission. Commissions will be paid on sales. Commissions are paid on the 15th of the month following the order completion, invoice, and ship date. Lesser commissions may occasionally be paid on promotional, discounted, or discontinued items. In the event of non-payment of partial payment by customer, commissions that have been paid shall be adjusted to reflect the actual amount received by Our Company after deduction of any collection expense.”

Are they able to take away paid commissions due to the companies poor quality? I am doing what my contract says, but due to quality issues, I am losing money. Any advice or knowledge to shed?

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2 Answers

ARE_you_kidding_me's avatar

That’s usually what happens to sales commissions when merchandise is returned. If it did not work that way what would stop people from getting 10–20 of their friends to buy stuff, get you your commission and then return everything after the fact. This also helps keep salesmen somewhat honest when selling to actual customers.

Buttonstc's avatar

Unfortunately, this is standard policy for contract salespeople. (although this seems like a pretty poor commission percentage to begin with; just my opinion)

What is the company doing to address these poor quality issues? They should be vigorously pursuing this.

You need to go as high up the chain as necessary to get an accurate answer and if this issue isn’t being handled satisfactorily, there isn’t much left for you other than finding a different company with a better more consistent product.

These types of jobs generally have a pretty high turnover rate anyhow, in my experience.

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