countingstars: I don’t quite get the social security thing. So, they are selling the product and making the money off of the customer, but refusing to pay the salesperson due to forgetting to enter a social security number during the sales process? If that SS# is essential in the sale actually being processed, than it means the sale would be null and void if the salesperson forgets to enter it. And, either the sale is lost entirely, or someone else has to fix it for it to be valid. So, the salesperson who made the error may not get paid for it. That’s not entirely unreasonable. If the sale still goes through fine with zero hangups (despite the missing number), than they are just finding a loophole to not have to pay the salesperson.
As for the tax issue… We will use 20% in taxes just for an estimation. If, for instance, he sells ten vacuums at a commission of $100 each. He gets a check for $800 ($1000, less taxes). Perfect.
The next week, he sells ten more vacuums. However, he also had one return in that time frame. He should than be getting paid for the equivalent of the difference of the nine vacuums ($900), less 20% taxes off of THAT amount. So, for a total of $720. NOT 20% off the ten vaccums, and than less the original full $100 refund on top of that (which would be $700).
The next thing is… If you SO sells a vacuum, which is than returned, his employer has to refund the consumer. So, they don’t make any money on that. They only make the money back once it’s sold again. And, whichever salesperson (if any) sells it at that point, they should be the ones to get the commission on it. The company is still only making a profit once.
And, lastly… You won’t know if they are pocketing money. If they aren’t documenting it and paying taxes on it, than that’s wrong. However, that would all depend on how it’s being applied/deducted. If his employer writes him some random check without an explanation (pay stub) showing related taxes that were applied, than I would question it for sure. However, if it’s like I stated above, than I’d say it sounds legit.
There’s just too many factors to say for sure. And, again, I’m in a different state. It really depends on what work he does exactly, what the policies were upon being hired, what his pay stubs look like, etc.
If you truly think they are doing something shady, you can contact an employment attorney who could better evaluate all of those factors. They would be able to tell you if he has a case, and if he should fight for back pay. Go with all paystubs and documentation. The other option is to formally report his concerns with whatever Association oversees his industry, who may than open an investigation into the company (possibly perform an audit, request records, etc.)