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The commission structure outlines how a Sales Manager earns variable pay in addition to their base salary. Commissions are typically calculated as a percentage of sales revenue, profit margin, or achievement against specific sales targets. The contract specifies the commission rate, payment frequency (e.g., monthly or quarterly), and any performance thresholds that must be met before commission is payable. It may also clarify whether commissions are based on individual performance, team performance, or overall company results.
Commission entitlements after leaving depend on the terms of the employment contract. In most cases, only commissions that have been fully earned—meaning the sale has been completed and payment received—are payable after termination. Commissions linked to ongoing deals or future sales are usually forfeited unless the contract explicitly states otherwise. The contract should clearly define when a commission is considered “earned” to avoid disputes upon resignation or dismissal.
