 Imagine you've diligently worked to meet or exceed your sales targets and are counting on the commission you've earned according to your signed agreement. Then suddenly, your employer says there's a "mistake" in the agreement, or that you’re misinterpreting it, and you're going to be paid less. Can they really do that?
Like most questions, the answer is that it depends. But keep in mind that California law strongly favors employees in situations like these. Here's what you need to know: Your Commission Agreement Must Be in Writing California requires employers to have written commission agreements clearly explaining how commissions will be calculated and paid. You must receive and sign a copy acknowledging this agreement. (Cal. Labor Code § 2751.) Employers Cannot Refuse to Pay Earned Commissions Under California Labor Code § 200, commissions are considered wages once they are earned. Under various other Labor Code sections, employers are prohibited from failing to pay commissions when they are due and may not take back wages that are earned. Simply put, your employer can't retroactively reduce or take back your commission after you've performed your part of the deal. Mistakes Don't Automatically Excuse Payment Obligations Absent unconscionability, unless the mistake in your commission agreement is obvious or you have reason to know of the error, California law provides at least two clear legal theories supporting your entitlement to receive the agreed-upon commission:
Ambiguities Favor the Employee Employers may try and claim that you are misinterpreting your agreement, or that you don’t understand certain terms or phrases. While terms or phrases may have common or industry specific meanings, sometimes your employer’s poor choice of words causes there to be what courts refer to as an “ambiguity”— a term, phrase, or provision that is unclear, vague, or open to multiple reasonable interpretations. In those cases, California has long held that those ambiguities will be interpreted against the drafter of the agreement, which in most cases will be the employer. (Cal. Civ. Code § 1654; Sandquist v. Lebo Automotive, Inc. (2016) 1 Cal.5th 233.) Attorney's Fees and Costs If you're forced to sue for unpaid commissions and win, California law requires your employer to pay your reasonable attorney’s fees and costs. (Cal. Lab. Code § 218.5.) Bottom Line If you've performed your job based on a commission agreement, California law protects your right to be paid as promised—even if your employer claims there was a mistake. Employers cannot retroactively change terms after you've performed your work. If you're facing this issue, NorCal Advocates is here to help. We are dedicated to fighting for employees to ensure they recover the compensation they’re owed.
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 Recently, Meta announced that it would be cutting ties with "low performers," a statement that was closely followed by a 5% reduction in its workforce. For many former employees, the implication was clear: If you were let go, you must have been underperforming. However, some of those affected are pushing back, claiming they were not low performers and that Meta’s framing of the layoffs has harmed their professional reputations.
This situation raises a critical question in employment law: When does an employer’s characterization of an employee’s termination cross the line into defamation? Understanding Defamation in the Workplace Defamation occurs when someone makes a false statement about another person that damages their reputation. In California, defamation can take two forms:
To establish a defamation claim, a former employee must generally show:
When Layoff Announcements Go Too Far Employers have the right to downsize, but they must be careful about how they frame layoffs. If Meta—or any other company—publicly states that terminations were based on performance, yet some of those affected had no history of poor reviews or performance issues, those employees might have a claim for defamation. For example:
The Real-World Consequences of Workplace Defamation Being labeled a “low performer” can have serious career consequences. In industries like tech, where networking and reputation are key, a false implication of underperformance can cost someone future job opportunities. Recruiters and hiring managers may hesitate to hire someone who was publicly linked to performance-based terminations. Damages May Be Presumed: Defamation Per Se in Employment Cases In California, defamation per se applies when false statements directly harm a person's professional reputation. If an employer falsely claims an employee was a poor performer or engaged in misconduct, the law may presume damages without requiring proof of actual harm. This is especially important in cases where someone may not have yet experienced damages or where damages may be difficult to prove, as companies will often not provide a reason for deciding not to hire someone. What Can Employees Do? If you suspect that your former employer has defamed you, consider the following steps:
Final Thoughts Layoffs are difficult enough without the added harm of a tarnished reputation. Employers should be mindful of how they communicate reductions in force, ensuring they do not misrepresent an employee’s performance. Employees who find themselves unfairly labeled have legal options to restore their professional standing. If you believe you have been defamed by your former employer, consider speaking with an attorney to explore your rights. In California, the law protects employees from reputational harm caused by false and damaging statements, and you may be entitled to legal recourse.  At NorCal Advocates, we understand that seeking help for alcohol or drug addiction is a deeply personal and often difficult decision. Many individuals struggling with substance use worry about how entering treatment will impact their job, leading them to delay or avoid getting the help they need. If this sounds like you, know that California and Federal law provides certain protections to help you seek the care you need while maintaining your employment.
Legal Protections for Employees Seeking Treatment California Labor Code § 1025 Under California Labor Code § 1025, private employers with 25 or more employees are legally required to provide reasonable accommodations for employees who voluntarily seek to enter and participate in an alcohol or drug rehabilitation program. This means that, in most cases, your employer must allow you to take a leave of absence or modify your schedule to receive treatment—so long as it does not create an undue hardship on the business. However, while the law protects your right to seek treatment, it explicitly does not shield employees from termination if they are unable to perform their job duties due to current alcohol or drug use. If an employer can demonstrate that your substance use is negatively impacting your performance, creating safety risks, or violating workplace policies, they may have grounds for termination. Related Laws Providing Additional Protections Even if your employer has fewer than 25 employees, you may still be entitled to time off for substance abuse treatment under various other laws including the California Fair Employment and Housing Act (FEHA), the Americans with Disabilities Act (ADA), the California Family Rights Act (CFRA), and the Family and Medical Leave Act (FMLA). While these laws generally do not protect employees who are disciplined or terminated because of misconduct or other issues arising from active addiction, those seeking treatment may be entitled to time off provided certain conditions are met. Health Coverage for Alcohol and Drug Treatment Financial concerns should not stand in the way of getting help. California Health & Safety Code § 1367.2 mandates that group health insurance plans covering hospital, medical, or surgical expenses must also provide coverage for the treatment of alcoholism. While coverage details vary by plan, many policies include inpatient and outpatient treatment services. If you’re considering treatment, check with your health insurer to understand what services are covered and what costs you may be responsible for. Workplace Rules and Employer Rights While California law encourages recovery, it also allows employers to enforce workplace rules related to substance use. This means that:
Confidentiality Protections Your employer must make reasonable efforts to keep private the fact that you have enrolled in an alcohol or drug rehabilitation program. Under California Labor Code § 1026, employers cannot disclose an employee’s participation in such a program. Additionally, the Health Insurance Portability and Accountability Act (HIPAA) prohibits employers from disclosing protected health information related to leaves of absence for alcohol or drug rehabilitation programs. Will You Be Paid While on Leave? Employers are not required to provide paid time off for employees attending an alcohol or drug treatment program. However, in some cases employees may:
Taking the First Step If you are struggling with alcohol or drug addiction and worried about your job, here are some steps to take:
You Are Not Alone Substance addiction is a medical condition, not a personal failure. Seeking help is a courageous step toward recovery, and California and Federal law recognizes the importance of treatment by providing employees with legal protections. If you have questions about how to balance work and recovery, NorCal Advocates is here to help. Contact us today for a free confidential consultation. |
AuthorThis blog is authored and maintained by NorCal Advocates' attorneys: 
Brittany V. Berzin
Connor W. Olson
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