| name | commission-plan-agreement |
| title | Commission Plan Agreement |
| description | Drafts U.S. commission plan agreements establishing compensation terms for agents, salespeople, or affiliates. Covers flat/tiered/hybrid structures, payment mechanics, clawbacks, territory definitions, termination effects, independent contractor classification, and restrictive covenants. Use when drafting or negotiating commission-based compensation in employment, consulting, or affiliate contexts. |
| author | CaseMark |
| author_url | https://github.com/CaseMark/skills/tree/main/skills/legal/commission-plan-agreement |
| license | Apache-2.0 |
| version | 0.1.0 |
| execution_mode | open |
| jurisdiction | us |
| practice | employment |
| language | en |
Commission Plan Agreement
Drafts a U.S.-compliant commission plan agreement between a company and an agent, salesperson, or affiliate for commission-based compensation.
Prerequisites
- Party details — legal names, entity types, jurisdictions, addresses, authorized signatories
- Commission structure — rate(s), basis (gross vs. net), tier thresholds, triggering event (signing, payment receipt, etc.)
- Territory — geographic boundaries or named market segments
- Product/service scope — covered items and exclusions (house accounts, existing customers)
- Payment schedule — frequency, method (ACH/wire/check), statement format
- Governing state — determines non-compete enforceability and commission payment statute obligations
- Existing documents — prior commission agreements, sales policies, expense policies
Output Structure
1. Preamble & Recitals
Identify parties with full legal names and addresses. Recitals establish commission-based sales relationship.
2. Definitions
| Term | Drafting Notes |
|---|
| Net Sales | Gross revenue less returns, refunds, discounts, taxes, shipping — list each deduction |
| Qualified Sale | Triggering criteria: executed contract, payment received, shipped, etc. |
| Territory | Geographic region or named accounts; map to Exhibit A if complex |
| Commission Period | Calendar month/quarter tied to payment cycle |
| House Accounts | Excluded accounts not eligible for commission |
| Clawback Event | Return, refund, chargeback, or cancellation within defined lookback window |
3. Commission Structure
Flat rate: Agent earns [__]% of Net Sales on Qualified Sales per Commission Period.
Tiered rate (Exhibit A or inline table):
| Cumulative Net Sales (per period) | Rate |
|---|
| $0–$[X] | [_]% |
| $[X+1]–$[Y] | [_]% |
