Commission / Sales Compensation Agreement - Missouri

COMMISSION / SALES COMPENSATION AGREEMENT

STATE OF MISSOURI

Table of Contents

1. Parties and Recitals
2. Position and Duties
3. Term of Agreement
4. Commission Structure
5. Base Compensation and Commission
6. Payment Timing
7. Draw Against Commission
8. Clawback Provisions
9. Post-Termination Commission Rights
10. Quota and Performance Standards
11. Territory and Accounts
12. Expenses and Reimbursement
13. Dispute Resolution
14. Termination
15. General Provisions
16. Missouri-Specific Notices
17. Signatures

1. Parties and Recitals

Employer:
Name: [________________________________]
Address: [________________________________]
City/State/ZIP: [____________________], MO [__________]
Phone: [________________________________]
Entity Type: [________________________________]

Employee (Sales Representative):
Name: [________________________________]
Address: [________________________________]
City/State/ZIP: [____________________], MO [__________]
Phone: [________________________________]
SSN (Last 4): [____]

Effective Date: [__/__/____]

This Commission / Sales Compensation Agreement ("Agreement") is entered into by and between the Employer and Employee identified above. The parties agree that the Employee's compensation shall be governed by the terms set forth herein, subject to applicable Missouri Revised Statutes Chapter 290 and, where its definitions are satisfied, RSMo §§ 407.911-407.915.

2. Position and Duties

Job Title: [________________________________]

Primary Responsibilities:

• [________________________________]
• [________________________________]
• [________________________________]

Reporting To: [________________________________]

Work Location: [________________________________]

Employment Status:
☐ Full-time employee
☐ Part-time employee

3. Term of Agreement

This Agreement shall commence on [__/__/____] and shall continue:

☐ Indefinitely, subject to the termination terms below and applicable law
☐ For a fixed term ending on [__/__/____], subject to renewal

Before selecting a termination option, review the offer letter, policies,
collective-bargaining terms, protected-activity rules, and any other agreement
that may control termination rights. This form does not establish that a
particular relationship is at will.

4. Commission Structure

Commission Type:
☐ Percentage of gross sales
☐ Percentage of net sales (after returns and allowances)
☐ Percentage of gross profit
☐ Flat fee per sale or unit
☐ Tiered/graduated commission schedule
☐ Other: [________________________________]

Commission Rate(s):

Commission Trigger Event:
☐ Upon execution of the sale or contract
☐ Upon delivery of goods or services
☐ Upon receipt of customer payment
☐ Other: [________________________________]

5. Base Compensation and Commission

Base Salary: $[________] per [☐ hour / ☐ week / ☐ month / ☐ year]

Total Compensation Structure:
☐ Base salary plus commission
☐ Commission only (see Draw provision in Section 7)
☐ Draw against commission (see Section 7)

6. Payment Timing

Commission Payment Schedule:
☐ Each regular pay period (including semimonthly where RSMo § 290.080 applies)
☐ Monthly (the option stated in RSMo § 290.080 for commission-based employees of covered corporations and railroad operators)
☐ Other: [________________________________]

Regular Pay Period: [________________________________]

Commissions shall be calculated and paid no later than [____] days after the end of the period in which the commission was earned.

7. Draw Against Commission

☐ This section applies / ☐ This section does not apply

Draw Amount: $[________] per [☐ week / ☐ pay period / ☐ month]

Draw Type:
☐ Recoverable draw (advances offset against future commissions)
☐ Non-recoverable draw (guaranteed minimum, not offset)

Negative Balance: If commissions earned are less than draws paid:
☐ The deficit carries forward to the next period(s)
☐ The deficit is forgiven at the end of each [☐ month / ☐ quarter / ☐ year]
☐ Other: [________________________________]

8. Clawback Provisions

☐ This section applies / ☐ This section does not apply

Commissions previously paid may be subject to clawback under the following circumstances:

☐ Customer cancels order within [____] days of sale
☐ Customer returns product within [____] days
☐ Customer defaults on payment within [____] days
☐ Other: [________________________________]

Maximum Clawback Period: [____] days from the date commission was paid.

No draw recovery, clawback, or offset may be applied unless counsel confirms
the written plan and payroll method comply with applicable wage-deduction,
minimum-wage, overtime, and earned-commission rules. Do not deduct an asserted
negative balance automatically from wages or final pay.

9. Post-Termination Commission Rights

Upon termination of employment (whether voluntary or involuntary), the Employee shall be entitled to:

☐ All commissions earned and unpaid through the last day of employment
☐ Commissions on sales closed but not yet paid by customers as of termination
☐ Commissions on pending orders submitted before the termination date that close within [____] days after termination
☐ No post-termination commissions beyond the last day of employment only if RSMo § 407.912 does not apply and counsel confirms this result is lawful

Payment of Final Commissions: If the parties qualify as a “principal” and “sales representative” under RSMo § 407.911, commissions due when their contract terminates must be paid within thirty (30) days after termination. A commission that becomes due later must be paid within thirty days after it becomes due. The written contract controls when a commission becomes due, subject to RSMo § 407.912.

10. Quota and Performance Standards

Sales Quota:
☐ Monthly quota: $[________]
☐ Quarterly quota: $[________]
☐ Annual quota: $[________]

Consequences of Failing to Meet Quota:
☐ Performance improvement plan
☐ Reduced commission rate of [____]%
☐ Reassignment of territory or accounts
☐ Grounds for termination
☐ Other: [________________________________]

11. Territory and Accounts

Assigned Territory: [________________________________]

Account Assignment:
☐ Exclusive territory — Employee is sole representative in the defined area
☐ Non-exclusive territory — Employer may assign additional representatives
☐ Named accounts only (see attached Exhibit A)

Territory Modifications: Employer reserves the right to modify territories with [____] days' written notice.

12. Expenses and Reimbursement

Reimbursable Expenses:
☐ Mileage at IRS standard rate ($[____] per mile)
☐ Travel expenses (airfare, lodging, meals) with prior approval
☐ Client entertainment with prior approval up to $[________] per [☐ month / ☐ quarter]
☐ Office supplies and equipment
☐ Other: [________________________________]

Expense Reporting Deadline: Expenses must be submitted within [____] days of being incurred.

13. Dispute Resolution

In the event of a dispute arising out of or relating to this Agreement:

Step 1 — Internal Resolution: The parties shall attempt to resolve the dispute through good-faith negotiation within [____] business days.

Step 2 — Mediation/Arbitration:
☐ Binding arbitration in [________________________________], Missouri, under the rules of [________________________________]
☐ Mediation before [________________________________]
☐ Litigation in the courts of the State of Missouri, [________________________________] County

If RSMo §§ 407.911-407.915 apply, this dispute clause may not waive any
protection in those sections. RSMo § 407.914 also supplies Missouri-court
jurisdiction over a covered out-of-state principal that contracts with a sales
representative to solicit orders in Missouri. Have counsel review arbitration,
forum, governing-law, fee, and remedy terms together before selecting an option.

14. Termination

By Employer:
☐ At will, with or without cause
☐ For cause, including but not limited to: [________________________________]
☐ With [____] days' written notice

By Employee:
☐ At will, with or without cause
☐ With [____] days' written notice

Effect of Termination: Upon termination, all company property, client lists, and proprietary materials must be returned within [____] business days. Commission payments after termination shall be governed by Section 9.

15. General Provisions

Entire Agreement: This Agreement constitutes the entire agreement between the parties and supersedes all prior negotiations, representations, or agreements.

Amendments: This Agreement may be modified only by written instrument signed by both parties. A company or corporation subject to RSMo § 290.100 must give affected employees thirty days' notice before reducing wages. Any commission-rate change must comply with that rule when applicable and with the written compensation terms governing commissions already earned.

Severability: If any provision is found invalid or unenforceable, the remaining provisions shall remain in full force and effect.

Governing Law: This Agreement shall be governed by and construed in accordance with the laws of the State of Missouri.

Protected Discussions and Proprietary Information: Nothing in this Agreement prohibits an employee from discussing wages, commissions, hours, or working conditions; engaging in protected concerted activity; reporting suspected unlawful conduct; or communicating with a government agency. Employee shall protect nonpublic customer lists, pricing strategy, and other lawfully protectable proprietary sales information, subject to those rights.

16. Missouri-Specific Notices

Monthly Payment Permitted: Under RSMo § 290.080, covered employers may pay salespeople and other employees compensated in whole or in part on a commission basis monthly rather than semimonthly.

Sales Representative Commission Act: If the parties satisfy the definitions in RSMo § 407.911, the written contract controls when commissions become due. Commissions due when the contract terminates must be paid within thirty days; commissions becoming due afterward must be paid within thirty days after becoming due. RSMo § 407.912.

Civil Remedies: Under RSMo § 407.913, a principal that fails to timely pay earned commissions may be liable for actual damages plus an additional amount calculated as if the sales representative continued earning commissions on an annualized pro rata basis from termination through payment. The court may award reasonable attorney fees and costs to the prevailing party. The statute does not describe this remedy as treble damages.

Audit Exception: Under RSMo § 290.110, the discharge-pay rule does not apply where remuneration is based primarily on commissions, the employee's duties include collection of accounts, care of merchandise, or similar activities, and an audit is necessary or customary to determine the net amount due.

Deductions Statement: A corporation doing business in Missouri, and a person operating a railroad or railroad shop in Missouri, must furnish the employee with a statement of total deductions at least once per month under RSMo § 290.080.

Minimum Wage and Overtime: Under current RSMo § 290.502, Missouri's minimum wage is $15.00 per hour effective January 1, 2026, subject to the chapter's coverage and exemptions and any higher applicable federal rate. If the employee is covered and nonexempt, the compensation plan must also satisfy applicable federal minimum-wage and overtime requirements under 29 U.S.C. §§ 206-207. Confirm coverage, exemptions, regular-rate treatment, and each workweek's calculations before use.

17. Signatures

By signing below, the parties acknowledge that they have read, understand, and agree to the terms and conditions of this Agreement.

EMPLOYER:

Signature: ______________________________ Date: [__/__/____]
Printed Name: [________________________________]
Title: [________________________________]

EMPLOYEE:

Signature: ______________________________ Date: [__/__/____]
Printed Name: [________________________________]

ACKNOWLEDGMENT OF RECEIPT

☐ Employee acknowledges receipt of a signed copy of this Agreement on [__/__/____].

Sources and References:

• RSMo Chapter 290 — Wages, Hours and Dismissal Rights: https://revisor.mo.gov/main/OneChapter.aspx?chapter=290
• RSMo § 290.080: https://revisor.mo.gov/main/OneSection.aspx?section=290.080
• RSMo § 290.100: https://revisor.mo.gov/main/OneSection.aspx?section=290.100
• RSMo § 290.110: https://revisor.mo.gov/main/OneSection.aspx?section=290.110
• RSMo § 290.502: https://revisor.mo.gov/main/OneSection.aspx?section=290.502
• RSMo §§ 407.911–407.915: https://revisor.mo.gov/main/OneChapterRng.aspx?tb1=407.911%20to%20407.915
• 29 U.S.C. §§ 206-207 and § 157: https://www.govinfo.gov/app/collection/uscode/2024/title29
• Missouri Department of Labor: https://labor.mo.gov