Unpaid Commissions Bonus Demand Letters

Gather all documents that define your compensation:

• Commission plan or agreement: Written terms specifying rates, triggers, payment schedule
• Offer letter or employment contract: May reference commission structure
• Employee handbook: Bonus policies, sales incentive programs
• Emails or memos: Communications promising bonuses or explaining commission changes
• Historical pay stubs: Show pattern of past commission/bonus payments

Create a spreadsheet showing each commission-triggering event:

In California, unpaid commissions can trigger additional damages:

Scenario: You were fired with $10,000 in earned commissions unpaid. Your average daily wage (including base + commissions) was $300/day.

• Signed commission agreement or plan document
• Offer letter referencing commissions/bonuses
• Sales reports, invoices, or CRM records showing your deals
• Emails confirming sales or commission amounts
• Pay stubs showing prior commission payments (establishes pattern)
• W-2 or 1099 showing total annual compensation
• Termination letter or separation agreement
• Correspondence with employer disputing the unpaid amounts

1. Employment summary: Dates, position, compensation structure
2. Commission/bonus terms: Reference written agreement (or describe oral/implied terms)
3. Earned amounts: Detail each commission-triggering event or bonus period
4. Amounts unpaid: Total unpaid commissions/bonuses
5. Legal violations: Cite Labor Code §§ 200, 201/202, 203, 2751 (CA) or FLSA/state wage laws
6. Penalties and damages: Waiting time penalties, interest, attorneys’ fees
7. Deadline: 14–21 days to pay in full or provide detailed explanation

Dear [Employer]:

I am writing to demand immediate payment of unpaid commissions [and/or bonuses] owed to me under our commission agreement and California law. I was employed by [Company] as a [job title] from [start date] through [end date]. My compensation included a base salary of $[X] plus commissions calculated at [Y%] of closed sales [or: bonuses based on achievement of quarterly sales targets].

During my employment, I earned total commissions of $[amount], of which you have paid only $[amount paid], leaving a balance of $[unpaid amount]. Under California Labor Code § 2751, commissions are wages that must be paid according to the terms of our written agreement. [OR: Under our oral agreement and established practice, I was entitled to receive commissions upon closing of sales, which I completed as detailed below.]

The following commissions were earned but never paid:

Date Earned	Customer/Deal	Sale Amount	Commission Rate	Commission Owed
1/15/2024	Acme Corp contract	$50,000	5%	$2,500
2/20/2024	XYZ Inc renewal	$30,000	5%	$1,500
TOTAL UNPAID COMMISSIONS:				$4,000

Each of these commissions was earned under the terms of our agreement when the sale closed and the contract was executed. You were obligated to pay these commissions [in my final paycheck / within 30 days of sale close / per the payment schedule], but failed to do so.

Your failure to pay these earned commissions in my final paycheck constitutes a violation of California Labor Code §§ 201–203. Under § 203, I am entitled to waiting time penalties equal to my daily rate of pay for each day the wages remain unpaid, up to 30 days. My average daily wage was approximately $[X], resulting in waiting time penalties of up to $[30 × daily wage].

In addition, I am entitled to recover prejudgment interest at 10% per annum and my attorneys’ fees and costs if I am forced to litigate this matter (Labor Code §§ 218.5, 1194).

Total Amount Due:

• Unpaid commissions: $[X]
• Waiting time penalties (§ 203): $[Y]
• Interest: $[Z]
• TOTAL: $[X+Y+Z]

I expect payment in full within 14 days of the date of this letter. If payment is not received by [specific date], I will have no choice but to file a wage claim with the California Labor Commissioner and/or pursue my claims in court, where I will seek the full amount of unpaid wages, waiting time penalties, interest, and attorneys’ fees.

Please send payment via [check/wire transfer] to [address/account]. If you dispute any portion of this claim, provide a detailed written explanation with supporting documentation within the same 14-day period.

Sincerely,
[Your Name]
[Contact Information]

• CFO or Controller: Handles payroll and commission payments
• VP of Sales or Sales Manager: If commissions are disputed based on sales terms
• Human Resources: For separation-related disputes or policy questions
• General Counsel or Legal Department: Larger companies with in-house counsel
• CEO or Owner: Small businesses or startups
• Registered Agent: For formal legal notice or if litigation is imminent

• Know your bottom line: Decide in advance the minimum you’ll accept (e.g., full commissions + 50% of penalties)
• Emphasize fee-shifting: Remind employer that if you win in court, they’ll pay your attorney’s fees on top of the judgment
• Highlight waiting time penalties: These penalties accrue daily and can double the claim—early settlement saves the employer money
• Document all communications: Keep emails, letters, and notes of phone calls—these are evidence if you litigate
• Set deadlines: Give employer 7–10 days to respond to counteroffers; don’t let negotiations drag out indefinitely

Employers sometimes assert you owe money (e.g., “chargebacks” for canceled orders, overpayments, unreturned equipment). Respond by:

1. Reviewing the commission agreement for any valid offset or clawback provisions
2. Demanding documentation (invoices, credit memos, proof of overpayment)
3. Disputing any offsets not explicitly authorized by the agreement
4. Noting that under CA law, deductions from wages require written employee consent (Labor Code § 221)

California employees can file a wage claim with the Division of Labor Standards Enforcement at no cost.

You can bypass the Labor Commissioner and file directly in superior court (state law claims) or federal court (FLSA claims).

• Unpaid commissions exceed $10,000
• Commission agreement is ambiguous or disputed
• Employer asserts complex defenses (forfeiture clauses, offsets, discretionary bonus)
• You were also denied overtime or other wage protections
• Multiple employees were affected (class action potential)
• Employer has sophisticated legal counsel
• You want to maximize recovery by including waiting time penalties and attorneys’ fees

I represent employees in commission and bonus disputes, from pre-litigation demand letters through trial. I focus on maximizing your recovery while minimizing your out-of-pocket costs by leveraging California’s fee-shifting statutes.

• Commission agreement analysis: Review and interpret your agreement to determine what’s owed
• Damages calculation: Itemize unpaid commissions, bonuses, waiting time penalties, and interest
• Demand letter drafting: Persuasive pre-litigation demand with detailed factual and legal support
• Negotiation: Secure maximum settlement without litigation
• DLSE representation: Represent you at Labor Commissioner hearings
• Court litigation: File and prosecute wage claims in superior court or federal court
• Class actions: Pursue class claims if employer systematically withheld commissions from multiple employees

1. Comprehensive audit: I review all commission/bonus agreements, sales records, pay stubs, and communications to identify every dollar owed
2. Multi-theory recovery: I don’t just claim unpaid commissions—I also pursue waiting time penalties, wage statement violations, and interest to maximize damages
3. Strategic demands: I draft demand letters that emphasize the employer’s exposure to penalties and attorneys’ fees, creating settlement pressure
4. Fee-shifting leverage: I use California’s mandatory fee-shifting laws to negotiate favorable settlements—employers know they’ll pay my fees if they lose
5. Class action assessment: If your employer has a pattern of withholding commissions, I explore class action options to multiply recovery and deter future violations