In Klauber v. VMWare, the First Circuit upheld an employer’s use of a provision in its compensation plan that allowed it to modify commissions on certain large or atypical sales. These “windfall” clauses are common in sales commission plans, and the First Circuit’s decision affirms that employers may continue to use them without violating the Massachusetts Wage Act, which otherwise would invite the prospect of paying treble damages on disputed incentive compensation earnings.
The…