Commission / Sales Compensation Agreement

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COMMISSION / SALES COMPENSATION AGREEMENT

STATE OF NEBRASKA

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. Nebraska-Specific Notices
17. Signatures

1. Parties and Recitals

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

Employee (Sales Representative):
Name: [________________________________]
Address: [________________________________]
City/State/ZIP: [____________________], NE [__________]
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, in compliance with the Nebraska Wage Payment and Collection Act, Neb. Rev. Stat. §§ 48-1228 to 48-1236.

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 (at-will employment) until terminated by either party
☐ For a fixed term ending on [__/__/____], subject to renewal

Nebraska is an at-will employment state. Unless a fixed term is specified above, either party may terminate the employment relationship at any time, with or without cause or notice.

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
☐ Monthly, on or before the [____] day of the following month
☐ 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, or the next regular payday following the employer's receipt of customer payment (per § 48-1230.01), whichever applies.

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.

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 all orders delivered or on file at the time of separation
☐ 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

Payment of Final Commissions: Under Neb. Rev. Stat. § 48-1230.01, upon separation, unpaid wages constituting commissions shall become due on the next regular payday following the employer's receipt of payment from the customer from which the commission was generated.

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 [________________________________], Nebraska, under the rules of [________________________________]
☐ Mediation before [________________________________]
☐ Litigation in the courts of the State of Nebraska, [________________________________] County

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. Commission rate changes require [____] days' advance written notice to Employee.

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 Nebraska.

Confidentiality: Employee agrees to maintain the confidentiality of commission rates, compensation structure, and proprietary sales information.

16. Nebraska-Specific Notices

Wage Payment and Collection Act: Neb. Rev. Stat. §§ 48-1228 to 48-1236 governs commission compensation. "Wages" includes compensation on a commission basis, including commissions on all orders delivered or on file at separation (unless modified by written agreement).

Commission Upon Separation (§ 48-1230.01): Unpaid commission wages become due on the next regular payday following the employer's receipt of the customer payment that generated the commission.

Written Agreement Importance: Nebraska courts recognize that employers and employees may contractually define when commissions are payable. This Agreement serves as the written employment contract contemplated by the statute.

30-Day Notice for Pay Changes: Under § 48-1230, 30 days' written notice is required before altering regular paydays.

Administrative Penalties (§ 48-1234): Violations of the Act may result in penalties of up to $500 (first violation) and $5,000 (subsequent violations), plus any wages due.

Minimum Wage: Nebraska's minimum wage is increasing to $15.00/hour by 2026. Commission earnings combined with base pay must meet or exceed this threshold.

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:

• Nebraska Wage Payment and Collection Act (§§ 48-1228 to 48-1236): https://nebraskalegislature.gov/laws/statutes.php?statute=48-1228
• Neb. Rev. Stat. § 48-1230.01: https://nebraskalegislature.gov/laws/statutes.php?statute=48-1230.01
• Nebraska Department of Labor: https://dol.nebraska.gov