Tag Archives: Michigan Sales Representative Commission Act

Sales Representative Alert: It is time to review your sales representative agreements

The end of 2011 brought companies a stark reminder why it will be important to review their sales representative agreements in early 2012. InRamirez v. International Business Machines, 2011 WL 5301777 (E.D. Mich., Nov. 3, 2011), the Court reiterated the applicability of the Michigan Sales Representative Commission Act (SRCA) to disputes involving oral sales representative agreements. IBM argued that oral contracts were exempt from the requirements of the SRCA, but the Court cited multiple Michigan cases that found that oral agreements are subject to the SRCA, including its penalty provisions. If you do not have your agreements with your sales representatives in writing, not only do you not have certainty in the terms of those contracts, you may unknowingly be subject to penalties in addition to the commission owed to your representatives, and the payment of their legal fees in disputes over commissions. Each state has different laws regarding oral sales representative contracts and no company wants to be caught off guard. 

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