Commission

Employee commission refers to the incentive offered to employees based on their sales performance. It is an additional amount of money paid to employees beyond their regular salary or wages, as a reward for generating revenue for the company.

The commission amount is usually calculated as a percentage of the total sales revenue generated by the employee. The percentage rate can vary depending on the industry, product, and the specific company policy.

Commission-based pay structures are common in sales-focused industries such as real estate, insurance, and retail where employees need to generate sales to earn a significant portion of their income. Commission-based incentives motivate employees to increase their sales productivity, which, in turn, benefits the company.

Some companies also offer tiered commission rates, where higher sales volumes result in higher commission rates. This system motivates employees to aim for higher sales targets, which helps increase the company's revenue.

In conclusion, employee commission is an attractive incentive-based compensation program that encourages employees to make more sales, generating more revenue for the company while enhancing their earnings potential.