Whitney, LLP’s car dealer wage theft lawyers recovered $18,000 after filing a wage theft lawsuit when a Maryland car dealer did not pay commissions due to their former finance manager.   In addition to representing hundreds of consumers in a variety claims against new and used Maryland car dealers, Whitney, LLP also represents car dealer employees, from lot men, to salespeople, to finance sales managers, in wage theft claims.  Our Maryland employment lawyers and car fraud lawyers understand that many Maryland car dealers do not just cheat consumers, they also cheat their own employees.

Fortunately, Maryland wage law and federal wage law provide strong protections for car dealer employees and managers who have wage claims against car dealers.  We have successfully represented multiple car dealer employees in unpaid wage claims against new and used car dealers in Maryland.  These include illegally deducting wages due to an employee damaging a dealer vehicle while driving it for work purposes, to claims regarding unpaid commissions.

In this blog, we discuss legal rights of car dealer employees to get paid their earned wages and commissions, and share the details of a case we filed in Circuit Court in Maryland where a new car dealership did not pay commissions due to their former finance manager.  The dealer’s excuse was that she was not entitled to her wages because she was not employed by a certain date in the month after she had earned the commissions.  Of course, this was an illegal, nonsense excuse that the dealer abandoned after suit was filed.

In Maryland, employees, including car dealer salespeople, finance managers and sales managers, are generally entitled to wages they earn as soon as the wages are earned – in other words, once you work the hours, make the sale or assign the finance contract to the lender, you are entitled to that commission, whether you resign or are fired before your next paycheck.

Call us now at 410 583 8000 or use our online Quick Contact Form for your Free and Confidential Car Dealer Wage Theft Case Evaluation.  We represent clients in wage disputes across Maryland, including Baltimore, Columbia, Silver Spring, Waldorf, Annapolis, Rockville, Salisbury and Hagerstown.

Read about some of our past car dealer case results, including $60,000 for illegal credit pulls by a dealer, and a $35,843 judgment against National Auto in Waldorf, Maryland.

Watch our videos about some of the cases and variety of legal issues our Maryland attorneys handle on our YouTube Channel. 

Whitney, LLP represents Maryland car dealer employees who were not paid the wages or sales commission they earned.

Maryland Car Dealer Did Not Pay Commissions?

A common “gotcha” in a car dealership pay plan is language that tries to erase earned commissions the moment an employee resigns or is terminated, even when the work is already done and the money earned. Whitney, LLP has successfully represented car dealer employees involving commission pay plan disputes and wage theft claims, including cases where employers attempt to rely on illegal pay-plan fine print to justify withholding pay.

If you are searching for a Maryland wage theft lawyer because a car dealer refused to pay your earned commissions, illegally reduced the amount of your earned commission in violation of your pay plan, or withheld your last check, Whitney, LLP’s wage theft lawyers can help you fight back and assert your legal rights for wage payment and additional damages.

The Case: Finance Manager Commission Dispute

In this case, our client was a finance manager at a new car dealership.   As a condition of employment, she signed a commission pay plan that stated she “must be employed…for the entire calendar month” to be eligible for commissions. However, this was an illegal clause and designed to create an excuse for her employer to keep her earned commissions if and when she resigned or was fired.

Due to disagreement with the car dealer’s employment practices, including how they treated their customers, and what they wanted her to do, our client decided to resign.  That is when the problems started:

This text from our client to her manager shows the employer attempting to enforce an illegal pay plan provision requiring employment on a certain date in order to be paid for previously earned commissions. Whitney, LLP’s car dealer wage theft attorneys then filed suit and recovered double what was owed to her.

Timeline of the Car Dealer Unpaid Commissions Dispute:

• December 2023: The employee worked the full month, earning approximately $8,000 in commissions.

• January 2, 2024: She resigned after completing the full month of December.

• The Payday: On January 15, the dealership’s normal pay date, she received nothing for her December work.

• The Excuse: The dealership claimed she “forfeited” her commissions because she was not employed through the end of January.

After going back and forth and attempting to resolve the matter with her employer, our client realized she would need to find a Maryland employment lawyer to help her.  After searching for a lawyer for when the car dealer did not pay commissions, she found Whitney, LLP’s car dealer wage theft lawyers.

Our client provided us with a copy of her pay plan.  After reviewing the pay plan, we determined that the language the dealer was relying on in withholding the commissions was legally unenforceable.  After filing the car dealer wage theft lawsuit, the dealer eventually agreed to pay over $18,000, approximately double the commissions it still owed our client, and including payment of her attorney’s fees. Of course, all cases are different, and past results do not guarantee future results.

Why “Wage Forfeiture” Clauses are Illegal Under Maryland Law

The illegal wage forfeiture clause in our client’s pay plan required her to be working on the second of the following month in order to be paid her earned commissions for the prior month.  This is illegal, and was quickly apparent to Whitney, LLP’s car dealer wage theft lawyers that the dealer was simply trying to keep their finance manager’s commissions.

If you need a Maryland wage theft lawyer, it is often because an employer is using an illegal forfeiture contract clause to avoid paying.  Fortunately, Maryland employer law contains many protections for car dealer employees.

1. Commissions are Legally Considered “Wages”

The Maryland Wage Payment and Collection Law (MWPCL) defines “wage” broadly to include any remuneration promised for service, which expressly includes commissions.

2. The Final Paycheck Rule

Under the Maryland Wage Payment and Collection Law, an employer must pay all wages due for work performed before termination on or before the day the employee would have been paid if employment had not ended.  For example, if a used car dealer salesperson earned commissions for sales made December 1 though December 14, and was fired on December 15, they are still entitled to payment on their next payday for the commissions earned before they were fired.

3. Maryland Courts Reject Employment “Traps”

Maryland law generally prevents employers from conditioning commission payments on “continued employment” if the work required to earn that commission is already complete.  The courts realize that it is unfair for an employer to get the benefit of work performed by an employee while failing to pay the employee for the work.

Maryland Car Dealer Wage Theft Lawsuit: Seeking Treble Damages for Wage Theft

Whitney, LLP’s Maryland employment lawyers filed a car dealer wage theft lawsuit alleging that when the dealer did not pay commissions, the dealership’s refusal to pay was intentional and lacked a bona fide dispute.  Whether a dispute is “bona fide” or not simply means whether or not it was a legitimate and reasonable dispute that led to wages being withheld, or, whether the employer was simply trying to steal wages from their employee.

• Count I: MWPCL Violation: If a court finds wages were withheld and not due to a bona fide dispute, it may award up to three times the unpaid wages (treble damages) plus attorneys’ fees.

• Count II: Conversion: We alleged the dealership wrongfully kept the client’s money for itself.  Conversion is a legal term for stealing.

• Count III: Breach of Contract: Failing to pay commissions earned under the car dealership pay plan is a material breach.

The Maryland car dealer wage theft lawsuit we filed explained that the impact of the dealer not paying the commissions included financial hardship and economic hardship due to being unable bills, as well as emotional distress and anxiety.

FAQ: Car Dealer Employment Commission Disputes

Do Maryland Wage Theft laws apply to car dealer employees?

Yes, salespeople and managers are protected under Maryland wage laws.

Can a car dealership withhold my commission if I quit?

No. Under the MWPCL, if the work to earn the commission was completed before you resigned, the dealership must pay those unpaid commissions Maryland on your next regular payday.

What are “treble damages” in a Maryland wage claim?

If an employer withholds your final paycheck Maryland without a legitimate legal reason, a court can order them to pay you triple the original amount owed.

Is a “must be employed on payday” clause legal in a Maryland car dealer pay plan?

Even if an employment contract signed by the employer and employee contains a provision requiring employment on payday, it is likely not enforceable.

Does it matter if I was fired or quit in order to be paid by commissions?

Generally you are entitled to your wages whether you were fired or resigned.

Both employees and consumers should understand that even if they sign a contract that contains an unfavorable contract provision, it will not be enforceable if it is illegal.   Unenforceable contract provisions that are in violation of the law are referred to legally as “void against public policy.”  When these contract provisions exist, it often takes the victim hiring an attorney in order for the car dealer to stop trying to enforce the illegal contract provisions.

Daniel W. Whitney, Jr. and Daniel W. Whitney, of Whitney, LLP

Maryland Car Dealer Wage Theft Attorneys – Whitney, LLP

We know that many car dealers do not just take advantage of consumers.  If you are a dealer employee, salesperson or finance manager facing a commission pay plan or wage dispute, Whitney, LLP’s Maryland employment lawyers can help you hold the dealership accountable.

We help car dealer employees fight back and hold their employers responsible for paying earned wages and commissions.

Call us now at 410 583 8000 or use our online Quick Contact Form for a Free and Confidential Case Evaluation.