Unpaid Commission or Bonus? How to Recover What You’re Owed

You spent the quarter chasing targets, closed the deals, and watched your commission disappear into a “discretionary review” or get treated as forfeited because you resigned a week before payday. Unpaid commission and bonus disputes are common, and whether you are owed the money usually comes down to two things: what your contract or commission plan says, and whether you met its conditions.

The short answer: start with your contract or commission plan. If you met its conditions and the commission became payable, section 323 of the Fair Work Act 2009 says an employer must pay amounts payable to an employee in relation to the performance of work in full, in money and at least monthly, and a note to that section lists incentive-based payments and bonuses. Ask in writing first, then send a letter of demand with the calculation and a deadline.

The legal context: contract first, Fair Work Act second

Commission and bonus entitlements are usually set by your written contract or a separate commission or incentive plan. The plan should say what triggers the payment (a sale closed, a target hit, an invoice raised or paid), how it is calculated, and when it is paid. Read it closely, because the exact wording usually decides the dispute.

Once an amount is payable, the Fair Work Act sets rules about how it is paid:

• Section 323. An employer must pay amounts payable to an employee in relation to the performance of work in full, in money and at least monthly. The note to the section says these amounts include incentive-based payments and bonuses if they become payable during a relevant period.
• Section 324. An employer may only deduct from those amounts in limited cases: for example, where the deduction is authorised in writing by the employee and is principally for the employee’s benefit, or is authorised by an enterprise agreement, a modern award, an FWC order, a law or a court order.
• Section 326. A term of an award, enterprise agreement or contract of employment has no effect to the extent it permits a deduction that is directly or indirectly for the employer’s benefit and is unreasonable in the circumstances.

The Fair Work Ombudsman’s deductions page puts it simply: an employer can only deduct money if the employee agrees in writing and it’s mainly for the employee’s benefit, or if a law, court order, Fair Work Commission order, award or registered agreement allows it.

Common employer responses, and what to check

• “Commission is discretionary.” Check whether the plan really leaves the amount to the employer’s discretion, or sets a formula and a trigger that you have met. A plan with a written formula reads very differently from one that says payments are entirely at the company’s discretion.
• “You weren’t employed on the payment date.” Check whether the plan says you must still be employed on the payment date, and whether the commission had already become payable before you left. Whether a forfeiture clause can be relied on can be contested, so get advice if the amount is large.
• “The customer hasn’t paid yet.” Whether that delays payment depends on the wording of your plan: some plans pay on invoice, others on receipt.
• “We’re recalculating clawbacks.” Ask for the clause that allows a clawback, and for the calculation. A deduction from your pay must fit one of the cases in section 324.

Step by step

1. Collect the documents. Your contract, every version of the commission or incentive plan that applied, sales reports, CRM screenshots, target letters, invoices, emails confirming deals, and your pay slips.
2. Do the calculation. For each deal or period, show the trigger, the date it was met, the rate and the amount, then total it.
3. Ask in writing. A short, polite email to your manager or payroll asking for payment by a date, with the calculation attached.
4. Send a letter of demand. If that doesn’t work, send a formal letter setting out the clause, the calculation, the total and a deadline (14 days is common).
5. Decide where to take it. See the options below.

The Letter of Demand approach

A Letter of Demand sets out the contractual basis (the specific clause of your contract or commission plan), the deals or targets that triggered the commission, the calculation, the total owed, and a deadline. Citing both the contract and section 323 of the Fair Work Act shows the employer you understand both bases of the claim. Only mention next steps you are prepared to take.

Where to take it if they still don’t pay

The Fair Work small claims process

The Fair Work Ombudsman says the small claims process can be used for underpayment claims up to $100,000, in the Federal Circuit and Family Court of Australia or the magistrates court in your state or territory. The dispute must relate to entitlements covered by the Fair Work Act, such as the National Employment Standards, an award or enterprise agreement, or safety net contractual entitlements, and the application must be made within 6 years of the contravention. Usually both parties represent themselves; a party who wants a lawyer needs the court’s permission.

A contract claim

If your claim rests only on your contract or commission plan, it may need to be brought as an ordinary breach of contract claim in your state or territory’s local or magistrates court instead. The Fair Work Ombudsman says it can only give information and advice on minimum entitlements, and that it can’t help with final pay entitlements that don’t come from the National Employment Standards, an award or an enterprise agreement. If you’re unsure which path fits, get legal advice before you file.

If you still work there

Raise it in writing with your manager or HR first and keep copies. If you think you are being treated badly for asking about your pay, talk to the Fair Work Ombudsman or a lawyer about whether the general protections in the Fair Work Act apply to you.

Frequently asked questions

Is commission part of my pay under the Fair Work Act?

Section 323 covers amounts payable in relation to the performance of work, and its note lists incentive-based payments and bonuses. Whether and when your commission became payable depends on your contract or plan.

Can my employer deduct a clawback from my pay?

Only where section 324 allows it: for example, where you authorised it in writing and it is principally for your benefit, or where an award, agreement, order or law allows it. A contract term that permits an unreasonable deduction for the employer’s benefit has no effect (section 326).

How long do I have to claim unpaid commission?

For the Fair Work small claims process, the application must be made within 6 years of the contravention. Contract claims also have time limits, and they differ between states and territories, so don’t sit on it.

Can the Fair Work Ombudsman help me?

It gives information and advice on minimum entitlements. It says it can’t help with final pay entitlements that don’t come from the National Employment Standards, an award or an enterprise agreement, so a purely contractual commission dispute may fall outside what it can help with.

What if I resigned before the commission was paid?

Check whether the plan requires you to be employed on the payment date, and whether the commission had already become payable before you left. If it had, ask for it in writing, with your calculation, alongside your final pay.

What Claim Done delivers (flat fee)

Answer a short wizard about your contract, the commission trigger, the deals or targets, and the calculation. Claim Done drafts a Letter of Demand that refers to your contract clauses and the relevant Fair Work Act sections, as a polished PDF. Flat fee of $49. You approve it before it is sent.