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SENDI v. NCR COMTEN

October 25, 1985

JOSEPH G. SENDI
v.
NCR COMTEN, INC.



The opinion of the court was delivered by: LUONGO

 Plaintiff Joseph Sendi brought this action claiming that his employer deprived him of earned commissions in violation of the Pennsylvania Wage Payment and Collection Law (WPCL), 43 P.S. § 260.1 et seq. Presently before me is defendant's motion for summary judgment. Because the record reveals no genuine issues of material fact, I will grant defendant's motion.

 The basic facts are not in dispute. Defendant NCR Comten is in the business of selling and leasing computer equipment. Plaintiff was hired by defendant's predecessor company in 1967, and in 1981 held the position of Regional Sales Director for defendant's eastern region. Plaintiff's compensation included commissions for sales and leases within the eastern region.

 On November 2, 1981, Sendi submitted a letter of resignation, requesting a termination date of December 31. He proposed to remain at Comten for part of November and use his accumulated vacation days to cover the rest of the period. Defendant rejected Sendi's proposal and terminated his employment as of November 6. Defendant gave him two weeks' severance pay and a lump sum payment for 200 hours of accumulated vacation, but paid him no commissions for contracts which closed after November 6.

 As a Comten employee, Sendi earned commissions under the NCR Comten Sales Representative Incentive Compensation Plan Agreement and the Regional Directors Compensation Plan Agreement (the Plans). The Plans provide that employees earn commissions on most sales and leases when Comten accepts the orders. For hardware lease or purchase contracts generating $10,000 or more of revenue, however, employees "qualify for 50% of the commission at the time the contract is accepted by NCR Comten and the Customer. The remaining 50% is payable when the equipment has been accepted by the customer and is Certified Ready for Use (CRFU) by NCR Comten." Sales Representative Incentive Compensation Plan Agreement at para. VI. The Plans further provide that commissions "are not earned until paid" and that employees "forfeit all rights to commissions which have not been paid at termination of employment." Id. at PP VI, VII.

 Plaintiff's complaint rests on two grounds. First, he claims that, regardless of the Plans' terms, he is entitled to commissions for all contracts generated by his efforts. Second, he claims Comten terminated him on November 6 rather than December 31 in order to deprive him of earned commissions.

 Defendant has moved for summary judgment on the ground that plaintiff was paid all commissions which he had earned prior to his termination. Defendant also contends that plaintiff was an employee at will with no right to set his own termination date.

 I. Plaintiff's Claim for Deprivation of Earned Commissions

 The WPCL provides:

 
Whenever an employer separates an employe from the payroll, or whenever an employe quits or resigns his employment, the wages or compensation earned shall become due and payable not later than the next regular payday of his employer on which such wages would otherwise be due and payable.

 43 P.S. § 260.5(a).

 Plaintiff argues that he is entitled to commissions for sales made between November 6 and December 31, 1981. He alleges that he was the only eastern region Sales Director in 1981, and that he is ultimately responsible for all sales concluded during that year. He also claims he was wrongfully deprived of commissions on certain hardware contracts worth more than $10,000. In accordance with the Plans, Sendi was paid only a 50% commission on such contracts which Comten accepted before his November 6 termination date, but under which the equipment was not installed and certified ready for use until after November 6. Plaintiff seeks to recover the remaining 50%. He argues that since the WPCL requires the payment of all "wages or compensation earned" he is entitled to commissions for all contracts attributable to his labor, and that the Plans' requirements cannot be applied to deprive him of such commissions. It is plaintiff's contention that summary judgment is inappropriate because his claims cannot be resolved without a detailed examination of his sales efforts and a determination of what contracts are traceable to those efforts.

 Plaintiff misconceives the nature of the WPCL. The statute itself does not create a right to compensation. Rather, it gives "additional protections to employes by providing statutory remedies for the employer's breach of its contractual obligation to pay wages." Ward v. Whalen, 18 Pa. D. & C.3d 710, 714 (C.P. Allegheny County 1981). See also Mirkin v. Cintas Corp., 538 F. Supp. 145, 148 n.2 (E.D.Pa. 1982). The contract between the parties governs whether specific wages or commissions are "earned." See Heimenz v. Pennsylvania Power & Light Co., 75 Pa. D. & C. 2d 405, 406 (C.P. Lycoming County 1976) (whether severance pay is wages according to the WPCL depends upon the terms of the contract between the parties). See also Wilson v. Homestead Valve Manufacturing Co., 217 F.2d 792, 797 (3d Cir. 1954) (under Pennsylvania law, "the compensation to which . . . [an employee is] entitled depends upon the language of the employment contract"), cert. denied, 349 U.S. 916, 99 L. Ed. 1250, 75 S. Ct. 606 (1955); Marcin v. Darling Valve & Manufacturing Co., 259 F. Supp. 720, 723 (W.D.Pa. 1966) (parties may by contract limit the "payment of commissions on orders placed before termination of employment"); Levan v. Royal Paper Products, 199 Pa. Super Ct. 505, 185 A.2d 801 (1962). It is necessary, therefore to determine whether under the Plans plaintiff earned the commissions he seeks to recover.

 I note that the Plans use varying and somewhat inconsistent terms to describe employees' entitlement to commissions. The Plans set forth when employees "qualify" for certain commissions and when other commissions are "payable," and in the same section state that commissions "are not earned until paid." The section following provides that employees forfeit all commissions not paid at time of termination. If the latter two provisions control, Sendi has earned no commissions not already paid and thus can recover nothing under the WPCL. In considering defendant's motion for summary judgment, however, I will construe the Plans most favorably to the plaintiff. I will thus assume that Sendi "earned" commissions when he "qualified" for ...


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