I Need Help Understanding My Commission Guidelines

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Hey guys, long time lurker, first time poster. I am looking to leave my current company, and have some contracts that I will sign soon that I'm afraid I won't get paid on. One contract in particular has several locations, which will all start at separate times spread throughout the year.

My commission guidelines language is a little confusing and I was hoping to get some help. I know I'm stupid for not fully understanding it before signing, but I was young, in a new state, and already accepted the job (pretty stupid there too).

Here's the language:

Part I – Calculation of Commissions

  1. Each Account Executive, or AE, will be eligible to earn a monthly commission amount on [Company Services] originated by them, referred to as Monthly Commissions, determined by multiplying their Qualifying Revenues for such month (as defined in paragraph 2 below) by the commission percentage rate applicable to such Qualifying Revenues, referred to as the Applicable Percentage (as defined in paragraph 3 below), less any applicable Charge Backs (as defined in paragraph 4 below). Each AE will also be eligible to earn a commission on Cash Manager Safe sales and rentals that he or she originates, referred to as Safe Sale Commissions, as provided in paragraph 5 below.

  2. Qualifying Revenues for any month means amounts (in U.S. Dollars) actually received by [Company] from client(s) under Qualifying Contract(s) with a start service date during such month in payment of the first full month of Qualifying Service(s) provided and billed under such contract(s), net of any applicable set-offs, counterclaims, deductions, charge-backs, discounts and other similar items. Notwithstanding the foregoing, only fifty percent (50%) of such amounts will be credited to the AE for the purpose of calculating Qualifying Revenues under Converted Contracts.

Qualifying Revenues are capped at $10,000 for any client or affiliated group of clients in any consecutive 12-month period, and do not include, without limitation, any:

  • ancillary charges and fees including without limitation, taxes, fuel surcharges, excess bag or item charges and excess premise time charges or similar items;

  • revenues attributable to amounts billed at a temporary, higher than standard rate, even though such revenue may be realized during the first full calendar month of service under a Qualifying Contract;

  • or amounts received in respect of services other than Qualifying Service(s).

Qualifying Service(s) means [Company Services] only (as defined in the [Company] Sales Training Reference Manual or any successor text).

Qualifying Contract means any of the following:

  • New Contract—a written binding contract between [Company] and a client for Qualifying Service(s) to be performed by [Contract] for a period of one year or more, where no prior contract for services to be performed by [Company] has been in force between [Company] and the client or any predecessor of the client for at least 12 months prior to the beginning of service under such contract.

  • Endorsement—a written binding modification or amendment to an existing contract to the extent that it adds or increases the Qualifying Service(s) or Qualifying Revenues under such existing contract.

  • Converted Contract—a direct contract between [Company] and the new owner of a business or business location for services to be performed by [Company] for a period of one year or more, which services were, as of the time of the acquisition by the new owner, being performed by [Company] under contract with the previous owner. A contract obtained with a corporation or other business entity which has acquired a business or business location currently serviced by [Company] as a result of a corporate reorganization where there is no material change in beneficial ownership or control of the business or location acquired is not a Converted Contract. For example, no Converted Contract exists where an existing client transfers ownership of a location serviced by [Company] to an affiliated corporation under common control, such as a wholly-owned subsidiary or a sister corporation owned by the same stockholder(s).

In each case, only if as a result of the AE’s effort such contract has been:

  • signed by an executive officer or other authorized representative of the client with the original delivered to [Company] within sixty (60) days following start of service there under;

  • accepted by [Company] within sixty (60) days following signing by the client, as evidenced by execution and delivery of the contract by [Company’s] Senior Vice President of Administration or other person authorized by [Company’s] Executive Vice President (it being in [Company’s] sole discretion whether to accept or reject any such contract);

For the sake of clarity, AE acknowledges that a contract that has not been signed by the client within sixty (60) days following the start of service shall not be eligible for Monthly Commissions, even if services are paid for in full by the client and/or the client eventually signs the contract beyond the sixty (60) day deadline and such contract is ultimately accepted, unless a written extension is granted by the Senior Vice President of Sales & Marketing.

Monthly Commissions, once earned, are credited toward and are applicable to the month in which the start service date occurs under the Qualifying Contract giving rise to such Monthly Commissions. If, for example, on October 16th, the client has paid in full for the first full month of Qualifying Services and the applicable Monthly Commissions have been otherwise “earned” under these Guidelines by such time, and the applicable Qualifying Contract had a start service date of September 1st, the Monthly Commission payable under such Qualifying Contract would be credited towards Monthly Commissions for the month of September.

Qualifying Contracts do not include, without limitation, any contract renewal, extension or re-write except to the extent that it adds or increases both Qualifying Service(s) and Qualifying Revenues.

  1. Qualifying Revenues:
  • [Service] Sales (including local, sales outside of market): 100%

  • [Service] Sales (national): 50%

  • [Service] (local, national, sales outside of market): 100%

  • Government Clients (as determined by [Company] from time to time): to be determined in the sole discretion of the Senior Vice President of Administration following submission of the completed Bid Commission Approval Form not to exceed 50%.

Part II – Payment of Monthly Commissions 1. [Company] shall pay Monthly Commissions for each month to actively employed AEs within sixty (60) days after they are earned, except that only 50% of Monthly Commissions on Qualifying Contracts that are month-to-month contracts shall be payable within such sixty (60) day period and the balance shall be paid upon completion of one (1) year of service under such Qualifying Contract.

  1. Upon the termination of AE’s employment, the AE shall be entitled only to those Monthly Commissions that have been earned prior to the effective date of termination. Such Monthly Commissions shall be paid within sixty (60) days after the effective date of AE’s termination, unless otherwise required by applicable law.

  2. For purposes of paragraphs 1 and 2 above, Monthly Commissions will be deemed to be “earned”, and therefore entitled to be paid, only after all of the requirements set forth in Part I have been satisfied and the AE has performed all work in connection with such Qualifying Contract(s) and/or Qualifying Service(s) as may be deemed necessary by [Company] in its sole discretion.

submitted by /u/thayer94
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