LawDepot’s Commission Agreement template and questionnaire help you create a valid employee agreement. Once you select the type of compensation your employee will receive, continue with the following steps:
1. Add the employment details
Include your and your employee’s names, addresses, and emails. Then, add information about what kind of business you or your company operate and your employee's employment type. This can be either:
- Full-time
- Part-time
- Contract or seasonal
2. Define the employee’s role
Listing your employees' job titles and duties in your contract is essential. These details ensure they clearly understand what will be expected of them in the role. To be even more thorough, include any work hours if necessary.
Next, add a start date and the state where your employee will work. The location will customize your document to follow the state laws and make a binding agreement.
3. Document commission details and structure
Add what salary or wage will be given to your employee if it applies to the role. Then, define the commission details and structure for their work. This will include:
- When the commission will be earned by the employee (i.e., upon payment of goods or services or upon delivery of goods or services)
- Sales targets your employee is required to meet
- How the commission will be calculated
- How often you’ll calculate the commission and pay your employee
- Any bonuses or incentives
- Any clawbacks events
- Any commission caps
4. Outline a termination clause
Employers can include a clause that documents their ability to end the contract at any time. This is known as at-will employment, which means an employer may dismiss an employee without notice or cause as long as the reason for termination is not illegal. This clause also applies to employees who may resign without notice or reason.
Please note that Montana is the only state that does not allow at-will employment.
It’s best practice to check state laws for any requirements to follow during employee termination, such as providing a Termination Letter.
5. Include any final details
Depending on the role, you can include any benefits your employee may receive and a probationary period if it applies to the job. Additionally, if you’re reimbursing an employee for out-of-pocket expenses, this should be included in your contract for future reference.
Before finishing your contract, create a confidentiality or non-solicitation clause if it applies to your employment practices to strengthen the agreement and protect your business.
Finally, add your signing date if you have one in place, or leave it open until you choose one. Then, if you wish to include an acknowledgment page for your employee to sign, select this option to add one to your contract. An acknowledgment helps show that an employee has received, read, and understood the terms of the Commission Agreement when they sign.