Sales Commission Plan

Employee: [Rep name] Role / title: [e.g., Account Executive] Manager: [Manager name] Effective dates: [Start date] to [End date] Currency: [Currency]

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1. On-target earnings (OTE)

Component	Amount
Base salary	[Annual base]
Variable pay at target	[Annual variable at 100% quota]
On-target earnings (OTE)	[Base + variable]

Base / variable split: [e.g., 60 / 40]

2. Quota & measurement period

• Quota (target): [Target result, e.g., annual bookings amount or units]
• Metric measured: [e.g., new-business bookings, net new revenue, units sold]
• Measurement period: [Monthly / Quarterly / Annual]
• What counts: [Define a "qualifying" sale — when it is credited, e.g., on signed contract or first invoice, and what is excluded.]

3. Commission rate tiers

[Rates apply to attainment against quota in the measurement period.]

Attainment band	Commission rate	Notes
0% – 50% of quota	[Rate]	[e.g., standard rate]
51% – 100% of quota	[Rate]	[e.g., standard rate]
Above 100% of quota	[Higher rate — accelerator]	[See Section 4]

4. Accelerators & SPIFFs

• Accelerator: [Describe the higher rate above quota and the threshold that triggers it.]
• SPIFF (optional): [Describe any short-term, focused bonus — what it pays, what triggers it, and the start/end dates of the SPIFF window.]

5. Caps, clawbacks & draw

• Cap: [State any maximum commission per period, or write "No cap".]
• Clawback: [State what happens to commission already paid if a deal is refunded, cancelled, or the customer fails to pay — e.g., recovered from the next payout.]
• Draw: [State any advance against future commission, whether it is recoverable or non-recoverable, and the amount and duration.]

6. Payment timing

• Calculated: [When commission is calculated, e.g., within X days of period close.]
• Paid: [When commission is paid, e.g., in the payroll run of the following month.]
• Conditions: [Any conditions, e.g., the rep must be employed on the payment date; deals must be fully invoiced.]

7. Terms & acceptance

[State that this plan governs commission for the effective dates above, that the company may review or update it for future periods with reasonable notice, and that nothing here changes at-will employment or guarantees continued employment. Note that this plan is not legal, tax, or financial advice and should be reviewed by a qualified professional.]

Accepted by (employee): ______________________ Date: ____________

Approved by (company): ______________________ Date: ____________