The Commission Based Employment Contract is essential for businesses operating in the Philippines that compensate employees primarily through commission-based structures. This document is specifically designed to comply with Philippine labor laws, including the Labor Code of the Philippines and various Department of Labor and Employment (DOLE) regulations. It's particularly relevant for sales-oriented roles where compensation is tied to performance metrics. The contract addresses crucial elements such as commission calculations, minimum wage compliance, statutory benefits, and performance expectations while ensuring proper worker classification under Philippine law. It's commonly used when hiring sales professionals, real estate agents, insurance agents, and other roles where variable compensation forms a significant portion of earnings.
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1. Parties: Identification of the Employer and the Employee with complete legal names and addresses
2. Background: Context of the employment relationship and brief description of the employer's business
3. Definitions: Key terms used throughout the contract, including specific commission-related terminology
4. Appointment and Duration: Nature of employment, position title, and term (fixed or indefinite)
5. Duties and Responsibilities: Detailed description of the employee's role, targets, and performance expectations
6. Commission Structure: Detailed explanation of commission calculations, payment terms, and conditions
7. Minimum Guarantees: Any guaranteed minimum earnings in compliance with Philippine minimum wage laws
8. Payment Terms: Schedule of commission payments, payment methods, and payment processing details
9. Working Hours: Expected working hours, flexibility, and time recording requirements
10. Statutory Benefits: SSS, PhilHealth, Pag-IBIG, and other mandatory benefits
11. Leave Entitlements: Vacation, sick leave, and other leave benefits
12. Confidentiality: Protection of company information and trade secrets
13. Non-Competition: Restrictions on working with competitors during employment
14. Termination: Grounds for termination and notice requirements
15. Governing Law: Specification of Philippine law as governing law and jurisdiction
1. Probationary Period: Terms of probationary period if applicable (use when role includes initial probation)
2. Travel Requirements: Travel obligations and reimbursement policies (use for sales roles requiring travel)
3. Equipment and Resources: Provision of sales tools, devices, or vehicles (use when company provides equipment)
4. Team Management: Leadership responsibilities and team commission structures (use for senior sales positions)
5. Training Requirements: Mandatory training programs and certifications (use when specific qualifications are needed)
6. Territory Assignment: Geographic or client territory definitions (use for field sales roles)
7. Non-Solicitation: Restrictions on soliciting clients or employees (use for senior roles with client relationships)
8. Expense Policy: Guidelines for reimbursable expenses (use when role involves expense claims)
9. Remote Work: Terms for remote working arrangements (use when applicable to the role)
1. Schedule A - Commission Rates: Detailed breakdown of commission percentages, tiers, and calculation methods
2. Schedule B - Performance Metrics: Specific KPIs, targets, and performance evaluation criteria
3. Schedule C - Territory Map: Detailed description or map of assigned sales territory
4. Schedule D - Product List: List of products/services with associated commission rates
5. Schedule E - Bonus Structure: Additional incentive schemes and bonus calculations
6. Appendix 1 - Expense Policy: Detailed guidelines for expense claims and reimbursements
7. Appendix 2 - Company Policies: Relevant company policies affecting commission-based employees
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