Home » Commentary » My Employer Verbally Changed My Compensation, But Never Documented It. What Should I Do?

Josh Goodbaum: Hi, Amanda.

Amanda DeMatteis: Hi, Josh. What are we going to talk about today?

Goodbaum: I want to talk about an employee who has a change in their compensation, but it’s not documented anywhere. What should they do about that?

So, let’s take an example: We have a commissioned salesperson. Every year, they get a different commission structure, and this year, instead of getting a document – a memo that spells out how they’re being compensated – the boss just brings the employee into a meeting and says, “Okay, you’re going to get 1% of these deals, 2% of these deals, 3% of these deals. Alright, go out and sell things now.” Does that employee need to document their sales plan anywhere, and what can happen if they don’t?

DeMatteis: 100%, Josh. Best practice is to get anything relative to your compensation – or any benefit that your employer is going to provide to you – in writing. What you just described was a pretty complex commission structure, and it could be really hard for us to understand later – once all the sales are done and the work for the year is complete – exactly how much that individual employee, in the example that you just provided us with, is owed for payment. So, the very best way to do that is, after a meeting like the one that you describe, to just send an email and memorialize, “This is my understanding of what my compensation is going to be for X period of time.”

We’ve also seen this come up in a little bit of a different example, where a person is promised, “Hey, you’re going to get this raise next year. You’re going to go from $20 an hour to $30 an hour,” and you are really excited, and you operate under the assumption that you’re going to continue to work for this year and next year you’re going to get that raise. Then next year comes along and you say to your boss, “Okay, when does my raise go into effect?”, and they say, “Oh, sorry, I don’t know what you’re talking about.” If you don’t have a contemporaneous record of that conversation, you might have no recourse at all for that raise that you claimed you were promised.

So instead of getting into a disagreement, and having to deal with the he said/she said of ‘you owe me this’ and ‘you said this’ and so on and so forth, send very simple email and just memorialize any compensation conversations that you have, if your employer does not provide you with some type of document outlining what your compensation is going to be.

Goodbaum: 100%, Amanda. People think, “Well, I asked HR for it and they never gave me anything, so there’s nothing I could do.” But your solution is such an elegant and simple one: just email and say what you heard, and if they don’t correct you, then you’ve got the memorialization of that conversation, and that’s really all you need in order to approach an employment lawyer and have a conversation about your compensation.

Thanks, Amanda. Thank you all for watching. We’ll see you next time.

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