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Commission Only Contract Template for New Zealand

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Key Requirements PROMPT example:

Commission Only Contract

"I need a Commission Only Contract for a software sales representative who will operate in the Auckland region, with a tiered commission structure starting at 10% for standard sales and increasing to 15% for premium product sales, to commence from March 1, 2025."

Document background
The Commission Only Contract is designed for businesses operating in New Zealand who wish to engage individuals on a purely commission-based compensation structure. This document is particularly relevant for sales-driven industries where performance-based compensation is standard practice. The contract carefully addresses the distinction between employee and independent contractor status, ensuring compliance with New Zealand employment law while providing flexibility in commercial arrangements. It includes comprehensive details about commission calculations, payment terms, performance expectations, and territorial rights. This agreement type is commonly used in sectors such as real estate, insurance, and direct sales, where compensation is directly tied to sales performance. The document incorporates all necessary provisions to protect both parties' interests while ensuring adherence to New Zealand's legal requirements for commission-based work arrangements.
Suggested Sections

1. Parties: Identification of the principal/company and the commission earner, including full legal names and addresses

2. Background: Context of the agreement, nature of the business, and purpose of the commission arrangement

3. Definitions: Key terms used throughout the agreement, including 'Commission', 'Sales', 'Territory', 'Products/Services'

4. Appointment and Status: Clear statement of appointment and confirmation of contractor status (if applicable)

5. Term: Duration of the agreement, including start date and renewal provisions

6. Commission Structure: Detailed explanation of commission rates, calculation methods, and payment terms

7. Payment Terms: Timeline for commission payments, payment methods, and handling of disputes

8. Performance Expectations: Minimum performance requirements, sales targets, and quality standards

9. Obligations of Commission Earner: Key responsibilities, reporting requirements, and conduct expectations

10. Company Obligations: Support, resources, and information to be provided by the company

11. Intellectual Property: Protection of company IP and handling of created materials

12. Confidentiality: Protection of confidential information and trade secrets

13. Termination: Grounds for termination, notice periods, and consequences

14. Post-Termination Obligations: Ongoing obligations and restrictions after contract end

15. General Provisions: Standard clauses including governing law, notices, and entire agreement

Optional Sections

1. Territory Rights: Used when the commission earner is assigned a specific geographic territory or market segment

2. Non-Compete Clause: Include when protecting against competition is crucial, subject to reasonableness tests

3. Training Requirements: Include when specific training or certifications are required

4. Expenses: Include when certain business expenses may be reimbursable

5. Insurance Requirements: Used when the commission earner must maintain specific insurance coverage

6. Sub-contractors: Include if the commission earner is permitted to use sub-contractors

7. Customer Ownership: Include when clarification is needed about customer relationship ownership

8. Dispute Resolution: Optional detailed dispute resolution process beyond standard courts

9. Marketing and Branding: Include when the commission earner will represent the company brand

Suggested Schedules

1. Schedule 1: Commission Rates: Detailed breakdown of commission rates, tiers, and any bonus structures

2. Schedule 2: Territory Map: If applicable, detailed description or map of assigned territory

3. Schedule 3: Product/Service List: Comprehensive list of products/services covered by the agreement

4. Schedule 4: Performance Metrics: Detailed KPIs, targets, and measurement criteria

5. Schedule 5: Reporting Templates: Standard forms and templates for required reports

6. Appendix A: Code of Conduct: Company policies and expected standards of behavior

7. Appendix B: Expense Policy: If applicable, rules and procedures for expense claims

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



































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Relevant Industries

Real Estate

Insurance

Financial Services

Retail

Wholesale Distribution

Technology Sales

Automotive Sales

Telecommunications

Professional Services

Manufacturing

Direct Sales

Marketing Services

Relevant Teams

Sales

Business Development

Channel Partners

Distribution

Commercial

Revenue

Partner Management

Account Management

Direct Sales

Field Sales

Inside Sales

Relevant Roles

Sales Representative

Business Development Manager

Account Executive

Real Estate Agent

Insurance Broker

Sales Agent

Territory Manager

Distribution Partner

Commercial Agent

Sales Consultant

Independent Sales Representative

Commission Agent

Business Development Representative

Channel Partner

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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