What is the effect on salespeople when a sole proprietor has their license suspended?

When a sole proprietor's real estate license is suspended, it directly impacts all salespeople who are affiliated with that individual. This is because the salespeople operate under the license of the sole proprietor. Consequently, they cannot engage in real estate activities while the license is suspended, as their legal authority to conduct business in real estate is contingent upon the broker's active license.

In this scenario, the salespeople must terminate their relationship with the firm to ensure they comply with regulations. This is essential for protecting their own standing and future opportunities in the real estate industry. Without a valid broker's license, they cannot legally perform any real estate transactions. Therefore, they are compelled to seek alternative affiliations or consider other options until they can join another brokerage that is fully licensed and operational.