Commissioner of Labor v. Oracle America Inc.
Absent proof that an employer transferred an employee to a non-commission position, an employer may be responsible to pay the employee performance-based commission wages. The defendant, Oracle America Inc., allegedly hired Edward Kelly, and they signed a compensation contract. The contract provided, "Employees do not earn Commissions . . . until the Company makes any and all final determinations and adjustments, modification or changes described above and in Section II.B below, and until the Company has been paid in full by the customer." In December 2010, Edward Kelly filed a complaint with the commissioner of the Department of Labor, alleging that Oracle America Inc. did not pay performance-based commission wages between June 2008 and May 2009. The commissioner concluded that Kelly was entitled to $64,214 in commission wages. Oracle of America objected that Kelly was not entitled to commission wages, because Kelly transferred to a non-commission position. Kelly denied that he transferred. The commissioner of the Department of Labor filed a complaint, and Oracle America Inc. moved to strike and argued that the alleged commissions did not qualify as wages. It was unclear whether Oracle America Inc. transferred Kelly. "Construing the complaint broadly and realistically," wrote the court, "the plaintiff has alleged facts to show that the commissions at issue may constitute wages under the wage payment statutes and the complaint has alleged facts sufficient to state a claim upon which relief may be granted." The court denied the corporation's motion to strike the complaint.