Wages & Commission

Jonny303

Hi,

I'm having trouble with paying wages when holidays get involved. When we initally hired this person, this bit was overlooked and I'm not sure how it should play out. I'll just use a round number to make things easier to understand

Weekly wage - €100 per day, weekly commission is 25% on everything taken in after basic pay (ie takes in €900, comes out with €600 (€500 + 25% of €400))

Now if that person takes 1 day off as a holiday, should the commission still be anything over the €500, or should it be anything over the €400?

Sorry if its confusing, I know there is probably no right or wrong answer but any advise is welcomed

TonyStark

Is the person responsible for sales on their day off?

Jonny303

No she wouldn't be, so I guess by that then you would be advising

On a taking of €900 pay would be as follows

€100 holiday, €400 daily wage and €125 commission (25% of €500)

sawilson2003

One weeks Holiday pay will be based on an average of the previous 13 weeks pay ending immediately before the commencement of the holiday period..

smeharg

Jonny303 wrote: »

No she wouldn't be, so I guess by that then you would be advising

On a taking of €900 pay would be as follows

€100 holiday, €400 daily wage and €125 commission (25% of €500)

So by taking a day off she gets €25 extra?!!

The €500 salary is a fixed cost. It should be deducted from the gross sales and commission calculated on the net amount.

To do otherwise would be to pay commission on the wage -commission is on sales.

Of course, the employee will probably see different.

Jonny303

sawilson2003 wrote: »

One weeks Holiday pay will be based on an average of the previous 13 weeks pay ending immediately before the commencement of the holiday period..

Sawilson, just on that, is that law?

I'm interested because certain jobs with great seasonality (such as car salesmen) would greatly differ.

If they took two weeks holiday in April after 3 months of full car sales, compared to say two weeks at Christmas, there holiday pay would be extreamly different, is that right?

sawilson2003

Its in the Organisation of working time Act 1997.

Link to the employment rights guide to holiday pay. See page 9 section 2.3 (ii)

http://www.employmentrights.ie/en/media/Guide%20to%20Holidays%20&%20Public%20Holidays%20-%20Jan%202012.pdf

smeharg

sawilson2003 wrote: »

Its in the Organisation of working time Act 1997.

Link to the employment rights guide to holiday pay. See page 9 section 2.3 (ii)

http://www.employmentrights.ie/en/media/Guide%20to%20Holidays%20&%20Public%20Holidays%20-%20Jan%202012.pdf

Thanks for the link. According to that page 15 applies when calculating a daily rate.

So, presumably, you'd calculate the 4 days pay in the normal manner, ie 4 days at €400 plus 25% commission on sales less €400, then calculate the daily rate for the day off based on the average daily rate over the previous 13 weeks.

sawilson2003

yep thats basically it, have to presume commission in that week will be lower than normal as 1 day is effectively unproductive towards sales...

DubTony

sawilson2003 wrote: »

yep thats basically it, have to presume commission in that week will be lower than normal as 1 day is effectively unproductive towards sales...

What happens in the week in which the holiday is taken is irrelevant. You should calculate the days pay based on the average daily pay in the prior 13 weeks.

sawilson2003

wasnt saying anything about that, was just pointing out that the commission will presumably be down in the week that the holiday payment is made....