Vector Marketing Corp. v. Employment Dept.

• Court: Oregon Court of Appeals
• Area(s) of Law: Employment Law
• Date Filed: 12-30-2015
• Case #: A155527
• Judge(s)/Court Below: Tookey, J. for the Court; Sercombe, P.J.; & Hadlock, J.

Incentive payments for the number of demonstrations performed by Vector’s salespeople are not “commissions” and are therefore not exempt from unemployment insurance tax.

Vector appealed determination by an ALJ that Vector owed unemployment insurance taxes for its salespeople. Vector’s salespeople were paid a minimum amount based on the number of sales demonstrations they performed, with commission in addition to that amount. Vector argued that the wage structure made the salespeople exempt under ORS 657.087(2) because they were paid by commission. The ALJ determined, and the Court agreed, that the fixed minimum payment amount counted as a guaranteed wage, not a commission. The Court determined, through statutory construction, that the definition of “commission” does not cover Vector’s pay for sales demonstrations, because the demonstrations were not keyed to any transaction with the customer, but were promised minimum incentives. Affirmed.

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