Sales Rep Fired Before the Deal Closed: Here's Whats to Know

Good Morning. Tomorrow is April Fool's Day, but since we don't send the newsletter on Wednesdays, consider this your early heads up: April 1st is also the first day of Q2. So if you get a meeting invite from HR or a "we need to talk" message from your manager, there's a solid chance it's not a prank. Stay sharp out there. Now, let's get into today's Follow Up. (:

Avoid asking what features they want 🛑
Marketing Against The Grain 🚀
Fired right before a deal is closed 👀
100 person sales team was just replaced by AI 😬
Sales jobs & a meme 😂

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Sales Tip of The Day 💡

During discovery, avoid asking buyers exactly what they want from a solution and start asking them what they're doing today to solve the problem.

❌ "What are the most important features you're looking for in a solution?"
✅ "Walk me through how you're handling this today… what does that process actually look like?"

Henry Ford once said that if he had asked people what they wanted, they would have said faster horses. Because they didn’t know a car was even a possibility.

Buyers don't always know what the solution looks like, but they know exactly what the pain feels like and what their dream outcome is.

So make them walk through it out loud, so you can frame your product as a solution to their problem.

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When you get Fired Before the deal is closed.

Early in my career, I got laid off with a full pipeline. Nothing that was ready to close tommorow.

But they were deals I'd been working for months, and were likely to close in a few weeks.

I was confident they'd close. And they probably did. But I never saw a dollar from any of them.

If you've been in sales for a while, you've either lived through something like this or watched someone else go through it. I see it happen to reps on Reddit all the time. Like this rep who got fired with a $1M deal at the finish line.

You build the pipeline, run the demos, handle the objections, and get it to the 1 yard line. Then you're gone, and the company collects.

So…. is there anything you can do about it? And if so, what do you need to do, before it’s too late?

Let’s break it down.

Where Your Commission Plan Ends

Most commission plans are written so that you only get paid on deals that close while you're employed.

That's the default. So if you leave, get laid off, or get fired the week before a deal closes, the company keeps the commission. Legally, they're usually in the clear.

But in some cases its not so black and white. HP once settled a class-action lawsuit for $25 million after roughly 2,000 salespeople claimed their commissions were miscalculated or unpaid.

That case took nine years, and most reps don't have nine years or a class-action legal team behind them.

The reality is that your commission plan is a contract, and most of those contracts and wirtten by the company, in favor of the company.

The Legal Concept That’s on Your Side (Sort Of)

There’s one thing that’s on our side called the "procuring cause" doctrine.

The basic idea is… if you were the reason a deal happened, you deserve the commission, even if you're no longer employed when it closes.

In 2022, the Texas Supreme Court ruled on this in a case called Perthuis v. Baylor Miraca Genetics. A sales rep was terminated, and the deals she had sourced closed after she left.

The court awarded her over $960,000 in commissions because she was the procuring cause of those sales.

But of course, there's a catch. The procuring cause doctrine typically only kicks in when your commission agreement leaves out the details about what happens after termination. If your plan says "commissions are only paid on deals closed during active employment," that language usually wins.

Some states offer more protection than others. California, New York, Texas, Illinois, and New Jersey all have specific laws around commission payments after termination. But the details vary widely, and the job of finding proof is almost always on you.

So… What Can I Actually Do?

Always read your commission plan before you need to.

*opens email and searches ‘commission plan agreement.*

It’s easy to put off reading it until something goes wrong. But then it’s too late.

Look for language about what happens to commissions on deals in progress if you're terminated. If it's vague or missing, that could actually work in your favor.

Document everything. Keep records of your deals, your pipeline, your emails, and your CRM entries. If you ever need to prove you were the reason a deal happened, you'll need a paper trail. And good CRM hygiene should be the default anyway.

And if you do get let go and you're owed money, talk to an employment lawyer. Of course, ChatGPT is a decent first step, but it's not going to represent you in court.

The reality for most reps, though, is that you're probably not going to sue your former employer over a commission check. The math doesn't work, the stress isn't worth it, and the legal system moves slowly.

It's an unfortunate part of sales that’s not fun to talk about. But it happens.

So you take the loss, update LinkedIn, and go close new deals somewhere else.

Disclaimer: I’m not a lawyer, and this is not legal advice. I’m just a sales guy. If you're dealing with a commission dispute, consult an actual attorney who specializes in employment law in your state.