AB438: Bill Text

6. To a commission salesperson who gives less than 5 days' notice of his or her intention to resign his or her position on demand by no later than 6 working days after the commission salesperson's last day of employment.

7. To the spouse, child or other dependent of a commission salesperson who dies on demand.

8. To a commission salesperson who is separated from the payroll of an employer as a result of the employer merging, liquidating, ceasing business operations or relocating on demand by no later than 24 hours after the time of separation.

Under the bill, the wages to which a commission salesperson is entitled on the ending of his or her employment are all commissions earned though the last day of employment, which is defined in the bill as commissions owed for any sale of goods made by the commission salesperson and approved by the employer on or before the last day of employment or for any sale of services made by the commission salesperson and delivered to and accepted by the customer on or before the last day of employment.

Also, under the bill, if the employe or commission salesperson whose employment ends was entrusted with money or property, the employer has 10 working days after the employe's or commission salesperson's last day of employment to audit and adjust the accounts of the employe or commission salesperson. In that case, the employe or commission salesperson may not demand his or her wages until after the expiration of the 10-day period.

In addition, under the bill, if an employer fails to pay an employe, on demand, within the applicable time period specified in the bill, DWD or a circuit court may order the employer to pay to the employe, in addition to the amount of wages due and unpaid and in addition to or in lieu of the increased wages and criminal penalties specified under current law, increased wages in the amount of the employe's average daily earnings for each day for which the employer is late in paying the employe's wages. Similarly, if an employer fails to pay a commission salesperson, on demand, within the applicable time period specified in the bill, DWD or a circuit court may order the employer to pay to the commission salesperson, in addition to the amount of wages due and unpaid and in addition to or in lieu of the increased wages and criminal penalties specified under current law, increased wages in the amount of one-fifteenth of the commission salesperson's commissions earned through the last day of employment that remain unpaid for each day for which the employer is late in paying the commission salesperson's wages.

Under current law, no person who grants a dealership (grantor), that is, a contract by which a dealer is granted the right to sell or distribute goods or services or to use a trade name, trademark, service mark, logotype, advertising or other commercial symbol, may terminate, cancel, fail to renew or substantially change the competitive circumstances of the dealership without good cause, that is, failure by the dealer to comply substantially with essential, reasonable and nondiscriminatory requirements imposed by the grantor or bad faith by the dealer. Also, under current law, a grantor must give a dealer 90 days' notice of termination, cancellation, nonrenewal or substantial change in competitive circumstances, stating the reasons for that action and giving the dealer 60 days in which to rectify any claimed deficiency, except that, if the reason for that action is the nonpayment of sums due under the dealership agreement, the dealer has only 10 days to cure the default and that, if the reason for the action is the dealer's insolvency, bankruptcy or an assignment for the benefit of creditors, the notice provisions do no apply.

This bill provides similar coverage for sales representative agreements, that is, contracts by which a sales representative is granted the right to represent, sell or offer for sale the goods of a manufacturer, wholesaler or importer by use of a trade name, trademark, service mark, logotype, advertising or other commercial symbol. The bill defines a "sales representative" as a person who contracts with a principal to solicit wholesale orders, that is, orders for goods to be ultimately sold at retail, and who is compensated by commission, but excludes from that definition an employe of the principal, a person who purchases goods for his or her own account for resale, a person who holds goods on consignment for resale, a person who sells goods to end users and not for resale and a person who is an insurance agent or broker.

Under the bill, no manufacturer, wholesaler or importer may terminate, cancel, fail to renew or substantially change the competitive circumstances of a sales representative agreement without good cause, which is defined in the bill as any of the following:

1. A material breach of a written sales representative agreement.

2. In the absence of a written sales representative agreement, a failure by the sales representative to comply with any material, reasonable and nondiscriminatory requirements of the manufacturer, wholesaler or importer.

3. The nonpayment of any sums due under the sales representative agreement.

4. The bankruptcy or insolvency of the sales representative.

5. An assignment for the benefit of creditors or similar disposition of the assets of the sales representative's business.

6. The voluntary abandonment by the sales representative of his or her business with no provision made for the resumption of that business by the sales representative or for the continuation of that business by a transferee of the sales representative.

7. The conviction of the sales representative for any offense the circumstances of which substantially relate to the circumstances of the sales representative's business.

8. Any act by the sales representative that materially impairs the good will associated with the manufacturer's, wholesaler's or importer's trade name, trademark, service mark, logotype, advertising or other commercial symbol.

In addition, under the bill, a manufacturer, wholesaler or importer must give a sales representative 90 days' notice of termination, cancellation, nonrenewal or substantial change in competitive circumstances, stating the reasons for that action and giving the sales representative 60 days in which to rectify any claimed deficiency, except that, if the reason for that action is the nonpayment of sums due under the sales representative agreement, the sales representative has only 10 days to cure the default and that, if the reason for that action is any of the reasons specified in items 4. to 8. above, the notice provisions do not apply.

Finally, the bill requires a manufacturer, wholesaler or importer who cancels, terminates or fails to renew a sales representative agreement to pay the sales representative for all sales made by the sales representative and approved by the manufacturer, wholesaler or importer on or before the effective date of that action as provided in the bill.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB438, s. 1 Section 1. 109.01 (1) of the statutes, as affected by 1997 Wisconsin Act 3, is renumbered 109.01 (1r).

AB438, s. 2 Section 2. 109.01 (1m) of the statutes is created to read:

AB438,5,7 109.01 (1m) "Commission salesperson" means a person, other than an insurance agent or broker, who is paid on the basis of commissions for sales and who is not covered under s. 109.03 (2) or (2g) because the person is an independent contractor rather than an employe.

AB438, s. 3 Section 3. 109.01 (1p) of the statutes is created to read:

AB438,5,14 109.01 (1p) "Commissions earned through the last day of employment" means commissions due a commission salesperson for any sale of goods made by the commission salesperson and approved by the employer on or before the commission salesperson's last day of employment or for any sale of services made by the commission salesperson and delivered to and accepted by the customer on or before the commission salesperson's last day of employment.

AB438, s. 4 Section 4. 109.01 (3) of the statutes is amended to read:

AB438,6,9 109.01 (3) "Wage" or "wages" mean remuneration payable to an employe or commission salesperson for personal services, including salaries, commissions, commissions earned through the last day of employment, holiday and vacation pay, overtime pay, severance pay or dismissal pay, supplemental unemployment compensation benefits when required under a binding collective bargaining agreement, bonuses and any other similar advantages agreed upon between the employer and the employe or commission salesperson or provided by the employer to the employer's employes or commission salespersons as an established policy.

AB438, s. 5 Section 5. 109.01 (4) of the statutes is amended to read:

AB438,6,13 109.01 (4) "Wage deficiency" means the difference between the amount required by law to be paid and the amount actually paid to an employe or commission salesperson.

AB438, s. 6 Section 6. 109.03 (2) of the statutes is amended to read:

AB438,6,21 109.03 (2) (title) Payment to discharged or resigned employes. Any Subject to sub. (4g), any employe, except including a sales agent employed on a commission basis other than an insurance agent, not having a written contract for a definite period, who quits employment or who is discharged from employment shall be paid in full by no later than the date on which the employe regularly would have been paid under the employer's established payroll schedule or the date of payment required under sub. (1), whichever is earlier immediately on the demand of the employe.

AB438, s. 7 Section 7. 109.03 (2g) of the statutes is created to read:

AB438,7,2 109.03 (2g) Payment to resigned employes. (a) Subject to sub. (4g), any employe, including a sales agent employed on a commission basis other than an insurance agent, not having a written contract for a definite period, who quits or resigns his or her employment shall be paid in full on demand by no later than 5 days after the employe quits or resigns his or her employment.

AB438,7,8 (b) 1. Subject to sub. (4g), any employe, including a sales agent employed on a commission basis other than an insurance agent, having a written contract for a definite period, who gives his or her employer not less than 5 days' written notice of his or her intention to quit or resign his or her employment shall be paid in full on demand by no later than 24 hours after the employe quits or resigns his or her employment.

AB438,7,15 2. Subject to sub. (4g), any employe, including a sales agent employed on a commission basis other than an insurance agent, having a written contract for a definite period, who gives his or her employer less than 5 days' written notice of his or her intention to quit or resign his or her employment shall be paid in full on demand by no later than the date on which the employe regularly would have been paid under the employer's established payroll schedule or the date of payment required under sub. (1), whichever is earlier.

AB438, s. 8 Section 8. 109.03 (2m) of the statutes is created to read:

AB438,7,23 109.03 (2m) Payment to terminated or resigned commission salesperson. (a) Subject to subs. (4) and (4g), any commission salesperson who gives his or her employer not less than 5 days' written notice of his or her intention to resign his or her position or whose contract of employment is terminated, canceled or nonrenewed by the employer shall be paid all commissions earned through the last day of employment on demand by no later than 3 working days after the commission salesperson's last day of employment.

AB438,8,3 (b) Subject to sub. (4g), any commission salesperson who gives his or her employer less than 5 days' written notice of his or her intention to resign his or her position shall be paid all commissions earned through the last day of employment on demand by no later than 6 working days after the commission salesperson's last day of employment.

AB438, s. 9 Section 9. 109.03 (3) of the statutes is amended to read:

AB438,8,23 109.03 (3) (title) Payment upon death of employe or commission salesperson. In Subject to sub. (4g), in case of the death of an employe or commission salesperson to whom wages are due, the full amount of the wages due shall upon on demand be paid by the employer to the spouse, children child, or other dependent living with such the employe or commission salesperson at the time of death. In the case of an employe or commission salesperson of the state, the amount of the wage due includes all unused vacation allowance. Any county or municipality may include unused vacation allowances for any employe or commission salesperson who died after January 1, 1961. An employer may, not less than 5 days after the death of an employe or commission salesperson and before the filing of a petition for letters testamentary or of administration in the matter of the decedent's estate, make payments payment of the wage due the deceased employe or commission salesperson to the spouse, children child, parent, brother or sister of the decedent, giving preference in the foregoing that order; or, if no such none of those relatives survive, the employer may apply such that payment or so much thereof of that payment as may be necessary to paying creditors of the decedent in the order of preference prescribed in s. 859.25 for satisfaction of debts by executors and administrators. The making of payment in such that manner shall be a discharge and release of the employer as to the amount of such that payment.

AB438, s. 10 Section 10. 109.03 (4) of the statutes is amended to read:

AB438,9,9 109.03 (4) (title) Payment to certain separated employes and commission salespersons. Whenever Subject to sub. (4g), if an employe or commission salesperson is separated from the payroll of an employer as a result of the employer merging, liquidating or otherwise disposing of the business, ceasing business operations in whole or in part, or relocating all or part of the business to another area within or without the state, the employer, or the successors in interest of the employer, shall pay all unpaid wages to the employe or commission salesperson at the usual place of payment within on demand by no later than 24 hours of after the time of separation.

AB438, s. 11 Section 11. 109.03 (4g) of the statutes is created to read:

AB438,9,21 109.03 (4g) Payment to employes or commission salespersons entrusted with money or property. Notwithstanding subs. (2), (2g), (2m), (3) and (4), if the discharged, terminated, resigned, deceased or separated employe or commission salesperson, during his or her employment, was entrusted with the collection, disbursement or handling of money or property, the employer shall have 10 working days after the employe's or commission salesperson's last day of employment to audit and adjust the accounts of the employe or commission salesperson before the employe or commission salesperson may demand his or her wages. In cases covered under this subsection, the penalties specified in s. 109.11 (1m) shall apply only from the date of demand made after the expiration of the 10 working days allowed for audit and adjustment.

AB438, s. 12 Section 12. 109.03 (5) of the statutes is amended to read:

AB438,9,25 109.03 (5) Enforcement. Except as provided in sub. (1), no employer may by special contract with employes an employe or a commission salesperson or by any other means secure exemption from this section. Each employe shall have a right of action against any employer for the full amount of the employe's wages due on each regular pay day as provided in this section sub. (1) and for increased wages as provided in s. 109.11 (2), and each employe and commission salesperson shall have a right of action against any employer for the full amount of the employe's or commission salesperson's wages due as provided in sub. (2), (2g), (2m), (3), (4) or (4g), whichever is applicable, and for increased wages as provided in s. 109.11 (1m) and (2), in any court of competent jurisdiction. An employe or commission salesperson may bring an action against an employer under this subsection without first filing a wage claim with the department under s. 109.09 (1). An employe or commission salesperson who brings an action against an employer under this subsection shall have a lien upon all property of the employer, real or personal, located in this state as described in s. 109.09 (2).

AB438, s. 13 Section 13. 109.03 (6) of the statutes is amended to read:

AB438,10,19 109.03 (6) Wage claim. In an action by an employe, a commission salesperson or the department against the an employer on a wage claim, no security for payment of costs is required. In any such proceeding action on a wage claim the court may allow the prevailing party, in addition to all other costs, a reasonable sum for expenses. No person other than an employe, commission salesperson or the department shall be benefited or otherwise affected by this subsection.

AB438, s. 14 Section 14. 109.03 (7) (title) of the statutes is amended to read:

AB438,10,21 109.03 (7) (title) Protection of employes and commission salespersons.

AB438, s. 15 Section 15. 109.09 (1) of the statutes is amended to read:

AB438,11,20 109.09 (1) The department shall investigate and attempt equitably to adjust controversies between employers and employes or commission salespersons as to alleged wage claims. The department may receive and investigate any wage claim which is filed with the department, or received by the department under s. 109.10 (4), no later than 2 years after the date the wages are due. The department may, after receiving a wage claim, investigate any wages due from the employer against whom the claim is filed to any employe or commission salesperson during the period commencing 2 years before the date the claim is filed. The department shall enforce this chapter and ss. 66.293, 103.02, 103.49, 103.82 and 104.12. In pursuance of this duty, the department may sue the employer on behalf of the employe or commission salesperson to collect any wage claim or wage deficiency and ss. 109.03 (6) and 109.11 (1m), (2) and (3) shall apply to such actions. Except for actions a wage claim or wage deficiency under s. 109.10, the department may refer such an action a wage claim or wage deficiency to the district attorney of the county in which the violation occurs occurred for prosecution and collection and the district attorney shall commence an action in the circuit court having appropriate jurisdiction. Any number of wage claims or wage deficiencies against the same employer may be joined in a single proceeding, but the court may order separate trials or hearings. In actions that are referred to a district attorney under this subsection, any taxable costs recovered by the district attorney shall be paid into the general fund of the county in which the violation occurs occurred and used by that county to meet its financial responsibility under s. 978.13 (2) for the operation of the office of the district attorney who prosecuted the action.

AB438, s. 16 Section 16. 109.09 (2) of the statutes is amended to read:

AB438,12,17 109.09 (2) The department, under its authority under sub. (1) to maintain actions for the benefit of employes and commission salespersons, or an employe or commission salesperson who brings an action under s. 109.03 (5) shall have a lien upon all property of the employer, real or personal, located in this state for the full amount of any wage claim or wage deficiency. A lien under this subsection takes effect when the department or, employe or commission salesperson files a verified petition claiming the lien with the clerk of the circuit court of the county in which the services or some part of the services were performed, pays the fee specified in s. 814.61 (5) to that clerk of circuit court and serves a copy of that petition on the employer by personal service in the same manner as a summons is served under s. 801.11 or by certified mail with a return receipt requested. The department or, employe or commission salesperson must file the petition within 2 years after the date that on which the wages were due. The petition shall specify the nature of the claim and the amount claimed, describe the property upon which the claim is made and state that the petitioner claims a lien on that property. The lien shall take precedence over all other debts, judgments, decrees, liens or mortgages against the employer, except a lien under s. 292.31 (8) (i), 292.41 (6) (d) or 292.81, and may be enforced in the manner provided in ss. 779.09 to 779.12, 779.20 and 779.21, insofar as such those provisions are applicable. The lien ceases to exist if the department or, the employe or commission salesperson does not bring an action to enforce the lien within the period prescribed in s. 893.44 for the underlying wage claim.

AB438, s. 17 Section 17. 109.11 (1) (a) of the statutes is amended to read:

AB438,12,23 109.11 (1) (a) In adjusting a controversy between an employer and an employe or commission salesperson as to an alleged wage claim filed with the department under s. 109.09 (1), the department may compromise and settle that wage claim for such a sum as may be that is agreed upon between the department, the employe or commission salesperson and the employer.

AB438, s. 18 Section 18. 109.11 (1m) of the statutes is created to read:

AB438,13,9 109.11 (1m) Late payment penalties. (a) If an employer fails to pay any wages due an employe, on demand, within the time period specified in s. 109.03 (2), (2g), (3), (4) or (4g), whichever is applicable, the department or a circuit court, subject to par. (c), may order the employer to pay to the employe, in addition to the amount of wages due and unpaid and in addition to or in lieu of any increased wages specified in sub. (1) (b) or (2) (a) or (b) or criminal penalties specified in sub. (3), increased wages in the amount of the employe's average daily earnings for each day for which the employer is late in paying those wages or in compromising and settling the wage claim to the satisfaction of the employe.

AB438,13,19 (b) If an employer fails to pay any wages due a commission salesperson, on demand, within the time period specified in s. 109.03 (2m) (3), (4) or (4g), whichever is applicable, the department or a circuit court, subject to par. (c), may order the employer to pay to the commission salesperson, in addition to the amount of wages due and unpaid and in addition to or in lieu of any increased wages specified in sub. (1) (b) or (2) (a) or (b) or criminal penalties specified in sub. (3), increased wages in the amount of one-fifteenth of the commission salesperson's commissions earned through the last day of employment that remain unpaid for each day for which the employer is late in paying those wages or in compromising and setting the wage claim to the satisfaction of the commission salesperson.

AB438,14,2 (c) Notwithstanding pars. (a) and (b), if an employer disputes the amount of a wage claim under s. 109.03 (2), (2g), (2m), (3), (4) or (4g) made by an employe or commission salesperson and pays to the employe or commission salesperson the amount that the employer in good faith reasonably believes is due within the time period specified in s. 109.03 (2), (2g), (2m), (3), (4), (4g), whichever is applicable, the penalties provided in pars. (a) and (b) do not apply, unless the department or a court later determines that the amount actually owed to the employe or commission salesperson is greater than the amount paid by the employer.

AB438, s. 19 Section 19. 109.11 (2) (a) of the statutes is amended to read:

AB438,14,11 109.11 (2) (a) In a wage claim action that is commenced by an employe or commission salesperson before the department has completed its investigation under s. 109.09 (1) and its attempts to compromise and settle the wage claim under sub. (1), a circuit court may order the employer to pay to the employe or commission salesperson, in addition to the amount of wages due and unpaid and in addition to or in lieu of the late payment penalties specified in sub. (1m) and the criminal penalties specified in sub. (3), increased wages of not more than 50% of the amount of wages due and unpaid.

AB438, s. 20 Section 20. 109.11 (2) (b) of the statutes is amended to read:

AB438,14,20 109.11 (2) (b) In a wage claim action that is commenced after the department has completed its investigation under s. 109.09 (1) and its attempts to settle and compromise the wage claim under sub. (1), a circuit court may order the employer to pay to the employe or commission salesperson, in addition to the amount of wages due and unpaid to an employe or commission salesperson and in addition to or in lieu of the late payment penalties specified in sub. (1m) and the criminal penalties specified in sub. (3), increased wages of not more than 100% of the amount of those wages due and unpaid.

AB438, s. 21 Section 21. 109.11 (3) of the statutes is amended to read:

AB438,15,5 109.11 (3) Criminal penalties. Any employer who, having the ability to pay, fails to pay the wages due and payable as provided in this chapter or falsely denies the amount or validity thereof of those wages or that such those wages are due, with intent to secure any discount upon such that indebtedness or with intent to annoy, harass, oppress, hinder or defraud the person to whom such those wages are due, may be fined not more than $500 or imprisoned not more than 90 days or both. Each failure or refusal to pay each employe or commission salesperson the amount of wages due at the time, or under the conditions required in this chapter, constitutes a separate offense.

AB438, s. 22 Section 22. Chapter 135 (title) of the statutes is amended to read:

AB438,15,9 CHAPTER 135 dealership and sales representation practices

AB438, s. 23 Section 23. Subchapter I (title) of chapter 135 [precedes 135.01] of the statutes is created to read:

AB438,15,12 CHAPTER 135

AB438,15,14 subchapter I dealership practices

AB438, s. 24 Section 24. 135.01 of the statutes is amended to read:

AB438,15,17 135.01 Short title. This chapter subchapter may be cited as the "Wisconsin Fair Dealership Law".

AB438, s. 25 Section 25. 135.02 (intro.) of the statutes is amended to read:

AB438,15,19 135.02 Definitions. (intro.) In this chapter subchapter:

AB438, s. 26 Section 26. 135.025 (1) of the statutes is amended to read:

AB438,15,22 135.025 (1) This chapter subchapter shall be liberally construed and applied to promote its underlying remedial purposes and policies.

AB438, s. 27 Section 27. 135.025 (2) (intro.) of the statutes is amended to read:

AB438,15,25 135.025 (2) (intro.) The underlying purposes and policies of this chapter subchapter are as follows:

AB438, s. 28 Section 28. 135.025 (3) of the statutes is amended to read:

AB438,16,4 135.025 (3) The effect of this chapter subchapter may not be varied by contract or agreement. Any contract or agreement purporting to do so is void and unenforceable to that extent only.

AB438, s. 29 Section 29. 135.05 of the statutes is amended to read:

AB438,16,11 135.05 Application to arbitration agreements. This chapter subchapter shall not apply to provisions for the binding arbitration of disputes contained in a dealership agreement concerning the items covered in s. 135.03, if the criteria for determining whether good cause existed for a termination, cancellation, nonrenewal or substantial change of competitive circumstances, and the relief provided is, are no less than that provided for in this chapter subchapter.

AB438, s. 30 Section 30. 135.06 of the statutes is amended to read:

AB438,16,19 135.06 Action for damages and injunctive relief. If any grantor violates this chapter subchapter, a dealer may bring an action against such that grantor in any court of competent jurisdiction for damages sustained by the dealer as a consequence of the grantor's violation, together with the actual costs of the action, including reasonable actual attorney fees, and the dealer also may be granted injunctive relief against unlawful termination, cancellation, nonrenewal or substantial change of competitive circumstances.

AB438, s. 31 Section 31. 135.065 of the statutes is amended to read: