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Commission Changes Without Consent: Ontario Employer Ordered to Pay
Employers in Ontario must tread carefully when modifying commission structures, especially when employment contracts restrict such changes without written agreement. Attempting to unilaterally alter commission policies without proper consent can lead to costly legal outcomes.
A recent decision from the Ontario Superior Court illustrates this risk. In McCoubrey v. Salesfloor Inc., 2025 ONSC 3739, the Court awarded over $USD61,000 to a former Vice President of Sales after her employer made changes to her commission plan without her written approval, as required by her contract.
This article outlines what happened in the case, explains key legal principles surrounding commission agreements, and offers practical tips for Ontario employers to avoid similar liabilities.
Case Overview: McCoubrey v. Salesfloor Inc., 2025 ONSC 3739
In McCoubrey, a senior sales executive was recruited in late 2020 from a secure role. As a condition of joining the new employer, she negotiated a contract that guaranteed her commission structure for three years, with any changes requiring written consent.
Despite this clear language, the employer introduced a revised commission policy in 2021 without seeking or obtaining her written agreement. The employee, believing the new policy did not apply to her, continued working and later resigned in 2022.
When she attempted to collect commissions on two large deals she had secured, the employer denied payment, arguing she was ineligible under the new policy.
What the Court Found
The Court disagreed and ruled in favour of the employee, finding that:
- The employment agreement explicitly prohibited changes to the commission plan without written consent.
- The employer never obtained such consent.
- The employee’s continued work and acceptance of different commission payments did not amount to agreement.
- Ambiguous language in the revised policy, particularly around the “time of disbursement,” — was interpreted against the employer.
The Court ultimately awarded the employee USD $61,228.28 plus pre-judgment interest.
As Christopher Achkar, employment lawyer and founder of Achkar Law, explains:
“Employment contracts that protect specific commission entitlements cannot be ignored or reinterpreted without proper legal steps. Even a small misstep can lead to substantial awards against the employer.”
Practical Tips for Ontario Employers
- Review and Follow Contract Language
Before making any changes to a commission structure, review employment agreements to confirm what restrictions apply. If written consent is required, obtain it before proceeding. - Avoid Unilateral Changes
Changing a key compensation term without a written agreement can trigger a breach of contract or constructive dismissal claim. Consult legal counsel before adjusting terms that affect earnings. - Clarify Policy Language
Vague or ambiguous terms, especially those relating to timing or eligibility for commissions, can backfire. Draft compensation policies clearly and have them reviewed for enforceability. - Don’t Assume Continued Work Means Consent
Just because an employee continues working after a change does not mean they accepted it, especially if the original contract says otherwise. Courts may find in the employee’s favour even after resignation. - Handle Resignations with Care
Commission disputes often arise at or after resignation. Ensure your offboarding process includes a review of outstanding entitlements based on the contract and any applicable policies.
Final Thoughts
The McCoubrey decision reinforces a key message for Ontario employers: employment contracts matter, especially when it comes to compensation. Failing to respect written commission terms or assuming consent where none exists can lead to significant liability.
Employers planning to modify compensation policies must take steps to ensure compliance with contractual obligations. A proactive approach, backed by legal advice, can help avoid unnecessary disputes and costly court outcomes.
Need Help Reviewing Your Commission Structure?
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The article in this client update provides general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Achkar Law Professional Corporation and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Achkar Law Professional Corporation. ©