10+ Commission Agreement Letter

Free Commission Agreement Letter Template Customizable

There are various ways people may get paid. Most people get paid on a monthly basis but some others get paid on an hourly basis. Even more, some others get paid on commission. If you get paid on commission, you will need to sign a commission agreement letter template.

What Is a Commission Agreement Letter?

This is a kind of agreement that contains the terms of employment & your compensation. It is very important. Therefore, both employer & employee have clear expectations. It is very important for you to know when to use a commission agreement letter.

First, you will need to use it when you hire a new employee who will be paid in whole or part on commission. It clarifies the terms of employment, containing the employer and employee’s expectation and & rights. It is also needed when someone hires you & you will be paid on commission.

Types of Commission Agreement Templates

A commission contract letter is divided into many types based on the uses. For your information, a commission agreement may be used for:

  • Non-disclosure commission
  • Independent contractors
  • Financial support
  • Corporate duties
  • Conditional sales
  • Commission lists
  • Business investments
  • Artists
  • Agent commission

You may create a commission contract letter template for the following reasons:

  • Trading commissions
  • Sales representatives
  • Stock purchases
  • Share purchases
  • Sales commission policies
  • Sales agencies
  • Real estate partnerships
  • Online commission

Parts of a Commission Agreement Template

A commission agreement template should contain the following clauses:

  • Definitions & interpretations
  • The introducer’s appointment
  • The potential clients’ introduction
  • Obligations of the company
  • Payments & fees
  • Relationships of the involved parties
  • Non-competition & confidentiality
  • Non-circumvention & termination
  • The agreement’s nature
  • Service & notices
  • Schedule of commission
  • Product schedule

How to Structure a Commission Agreement Letter

If you want to write this kind of agreement letter, you will have to know about its structure. Below are a few ideas for writing the structure of such a letter:

  • Basic salary plus commission

It is a good idea to add a basic salary. It ensures the employees that they have something to look forward to. In addition, there will be the incentive to get a bonus if they work harder. Of course, it keeps your employees productive & motivated.

  • Only commission

Sometimes, you can make an agreement when the employees only receive a commission. It ensures that your employees are say motivated to work hard.

  • Crapped commission

Here, you put a cap on the amount of commission that can be earned by your employees. This one applies to certain businesses.

  • Tiered commission

This can be used if you have highly-driven employees. They are very motivated to achieve their sales quotas & goals. You can also notice that they get better at their jobs.

  • Territory volume

If the sales people work with the same client in the same area, you should make an agreement structure protecting & benefiting them. This one lets the team widen their network. So, you can pay them based on territory-wide sales.

You can use our commission agreement letter template to ease your task. Some of the sample templates available here include a sales commission agreement, an artwork commission agreement, a leasing commission agreement, etc. Make sure that you find your preferred template and edit it.


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