Not so fast! Rep’s statutory rights are protected from getting contracted away
While sales rep protection statutes vary state to state, most contain a provision invalidating any contract term that would negate or limit the rights provided or would make the contract subject to the laws of a different state.
Sales rep statute protects a rep’s earned commissions upon actual and constructive termination
…An exploitative principal angling to replace its longtime independent rep and withhold the commissions due could find a means to escape the statute’s reach by stopping just short of affecting a full termination.
Tips to a better rep agreement
A sales representative typically will review a sales representative agreement twice — at the start of its relationship with a new principal, and then at the end.
Good facts and good judge support rep’s claim for breach of the duty of good faith and fair dealing
… When a principal terminates a contract not for any legitimate or neutral reason, but to shed the rep before a sale closes and commissions become due, raising a bad faith claim, which may make additional damages available, should at least be explored.
Buying or selling: Key factors for sales rep agency valuation
Factors such as long-term and stable relationships with principals and customers, selling products with a promising future in the market, and the firm’s commission income stream on the rise, tend to increase the price.
As a Public Service, Rep Lawyers Offer Free Advice to Principals
With surprising regularity, principals are taking legally flawed positions when reps must resort to legal action to collect commissions due, particularly following a termination.
Sales Rep Prevents Improper Termination with Rare Injunction
Sales rep lawsuits commonly seek to recover unpaid commissions following the termination of a rep contract.
Changing a commission plan is no shoe-in
Unscrupulous principals might originally plan to pay the agreed-upon commissions to their reps, and will perhaps honor the contract terms for a while, or at least until the orders start coming in reliably.
From Toothless to Tigers: A Look at State Sales Rep Statutes
“Hey, Adam,” begins many an incoming office call, “the principal who owes me back commissions didn’t remember that our contract says Tennessee law (or Utah, Colorado, New Jersey, Georgia, etc.) applies. I can get triple commissions, right?”
“Well,” begins the formal, technical response to many such calls, while stalling for time. Then, the very first legal phrase taught in law school is invoked: “That depends.”
Many independent reps are familiar with sales rep protection statutes. These state laws are generally intended to help level the playing field with their principals when a commission dispute arises.
Determined Sales Rep Recovers Commissions Plus Exemplary Damages from Bullheaded Principal
Most reps hunt for some valuable takeaways when a relationship with a principal ends badly. No hard searching was necessary after a recently completed rep-principal trial in Chicago, where the final count of useful “lessons learned” proved nearly as abundant as the sales rep’s recovery.