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Commission Based Employment Contract for Philippines

Commission Based Employment Contract Template for Philippines

This Commission Based Employment Contract is a comprehensive legal document designed for use in the Philippines, structured to comply with Philippine Labor Code requirements and relevant employment legislation. The agreement establishes the terms and conditions of a commission-based employment relationship, detailing commission structures, performance metrics, minimum guarantees, and statutory benefits. It includes provisions for both employer protection and employee rights, ensuring compliance with local labor standards while creating a clear framework for performance-based compensation.

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Commission Based Employment Contract

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What is a Commission Based Employment Contract?

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.

What sections should be included in a Commission Based Employment Contract?

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

What sections are optional to include in a Commission Based Employment Contract?

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)

What schedules should be included in a Commission Based Employment Contract?

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

Authors

Alex Denne

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

Jurisdiction

Philippines

Publisher

Ƶ

Document Type

Employment Contract

Cost

Free to use
Relevant legal definitions








































Clauses



































Relevant Industries

Retail

Real Estate

Financial Services

Insurance

Telecommunications

Automotive

Direct Sales

Technology

Medical Sales

Advertising

Travel and Tourism

Manufacturing

Pharmaceutical

Relevant Teams

Sales

Business Development

Commercial

Retail Operations

Account Management

Direct Marketing

Channel Sales

Field Sales

Inside Sales

Customer Success

Revenue Operations

Marketing

Relevant Roles

Sales Representative

Business Development Manager

Real Estate Agent

Insurance Agent

Sales Executive

Account Executive

Territory Sales Manager

Commercial Sales Manager

Medical Sales Representative

Recruitment Consultant

Financial Advisor

Marketing Consultant

Sales Director

Commission-based Customer Service Representative

Retail Sales Associate

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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