Timeshare Lawsuit Alleges Westgate Resorts Withholds Reserved Sales Commissions

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A proposed class action lawsuit alleges the operators of the Westgate Oceanfront Resort in Myrtle Beach, South Carolina, have unlawfully withheld certain reserved commissions from salespeople upon the conclusion of their employment.

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The 17-page Westgate lawsuit was filed by a former timeshare salesperson at the resort who claims the defendants—Westgate Resorts, Inc.; Westgate Resorts, Ltd; Westgate Myrtle Beach, LLC and Central Florida Investments, Inc.—wrongfully refused to release the “reserve funds” the woman had accumulated from past earned commissions at the conclusion of her employment.

According to the suit, the plaintiff and other commission-only salespeople were required to maintain with the companies a certain amount of reserve funds—typically $3,000 to $4,000 accumulated from prior commissions—for the purpose of reimbursing a commission payment to the defendants in the event that an employee’s sale was later rescinded by a customer.

The case explains that upon termination of a salesperson's employment, and the passing of any period within which the companies are entitled to make a “charge back” against the worker’s reserve funds, Westgate Resorts is obligated to release the remaining money to the employee.

However, the complaint alleges that the defendants wrongfully withheld the plaintiff’s reserve funds at the conclusion of her employment, even though, per the suit, the commissions had been earned by and belonged entirely to the woman.

“In fact, [Westgate Resorts] somehow claimed that the [the plaintiff] actually owed the defendants money for ‘charge backs’ that were paid up and above the reserve funds,” the filing shares.

The fraud case contends that the real estate companies have made a pattern of improperly retaining salespeople’s reserve funds, often purporting that the “funds are depleted” or that the former employee “actually owes money back” to the resort.

The Westgate Resorts lawsuit looks to represent anyone who, during the applicable statute of limitations period, worked as a commission-only salesperson for the defendants and had reserve funds held by the companies that were wrongfully withheld upon the conclusion of employment.

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