Commission Agreement



Use this commission agreement to set up a payment arrangement in which an employee is compensated base on work performance.

Uses

  • Hiring employees on commission
  • Offering professional services in exchange for a percentage return on the proceeds.

Overview

Many employees in retail, sales, or service establishments receive a commission as part of their pay. If you are considering paying someone based on their sales performance, use this commission agreement to set up a lawful payment structure.

A commission is typically paid as a fixed percentage of the revenue a worker brings to a company. For example, fees taken by real estate agents or financial brokers when they close a deal are a type of commission. However, federal and state laws regulate worker pay in every jurisdiction, and commissioned employees must be compensated at no less than the minimum wage that applies in your area. Workers being paid on a commission may also be subject to different overtime rules than other workers, so make sure you are clear on all of the employment laws that apply in your jurisdiction. Use this interactive form to guide you through some of the considerations you need to make when hiring employees on commission. If you have any questions, you may want to consult an attorney.

If you are a top seller or highly productive worker, you may want to negotiate a commission agreement yourself. If you want to get a piece of the revenue that you bring to a company or client, use this interactive form to create a customized commission agreement that works for you.