Explanations

In California real estate law, a salesperson (often referred to simply as an “agent”) cannot act independently and must be employed by a licensed broker.

All compensation for a salesperson’s services in a real estate transaction must be paid by their employing broker. This means that a salesperson cannot receive payment directly from a seller.

Therefore, an agent (salesperson) receiving direct compensation in a sales transaction from a broker with whom they have no employment relationship is considered unlawful. This violates the established structure where a salesperson’s earnings are channeled through their own employing broker, who then pays the salesperson according to their agreed-upon commission split.

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