NJ High Court Rules Commissions Are Wages Under State Law

On March 17, 2025, the New Jersey Supreme Court delivered a landmark ruling that significantly affects the legal rights of employees who are paid on commission — a substantial segment of the state’s workforce. The court declared that commissions are “wages” under the New Jersey Wage Payment Law (WPL), which governs how and when employers must pay employees. 

Under the ruling, Musker v. Suuchi, Inc., employers are required to pay owed commissions according to the requirements of the WPL, which imposes strict penalties on employers for violations. The employee can recover their commissions plus twice that amount as liquidated damages. The employee can also recover their attorneys’ fees for pursuing a WPL claim.

The case was brought by Rosalyn Musker a former sales representative for Suuchi, Inc., a company that manufactured personal protective equipment (PPE) among other products. Musker was not paid $1.3 million in commissions on PPE sales that she claimed were due. Suuchi, Inc. contended that these commissions were not “wages” under the WPL. The statute defines wages as “the direct monetary compensation for labor or services rendered by an employee, where the amount is determined on a time, task, piece or commission basis excluding any form of supplementary incentives and bonuses.” 

The trial judge found that the commissions in question were designed to incentivize Musker, a salaried employee, to go above and beyond her regular sales performance and that they were calculated independently of her regular compensation. As such, they were “supplementary incentives” and not “wages” under the WPL. An appeals court affirmed dismissal of the case.

On appeal to the Supreme Court, argued by Bruce Atkins of Deutsch Atkins & Kleinfeldt, P.C., the justices found unanimously that just because a form of compensation serves to incentivize, that does not make it a “supplementary incentive.” The key question is whether the compensation is for performing “labor or services.” A supplementary incentive is a reward for doing something beyond the employee’s labor or services, such as sharing office space with another employee, working out of a particular office location, achieving perfect attendance or referring a candidate to apply for an open position. By contract, selling PPE constituted rendering labor or services for which compensation was determined on a commission basis. Suuchi acknowledged that Musker’s earnings were directly tied to those sales. The court found the commissions therefore met the WPL’s definition of “wages.” The fact that Musker also received a base salary was irrelevant, since the WPL makes no such distinction.

Employees seeking to recover unpaid wages or can file a claim with the New Jersey Department of Labor and Workforce Development. If the department finds merit in the claim, it can order payment of amounts due. Alternatively, an employee, represented by an experienced New Jersey employment attorney can pursue legal action in court to claim unpaid wages, liquidated damage and attorneys’ fees. 

The lawyers at Deutsch Atkins & Kleinfeldt, P.C., with offices in Bergen County, New Jersey, and Rockland County, New York, are well-equipped to represent employees in disputes involving unpaid wages and commissions. Call us at 551-245-8894 or contact us online to arrange a consultation.