Commission Agreement

A Commission Agreement allows you to set the terms and conditions regarding the payment structure of commission to an employee or contractor.

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Last updated October 24, 2025

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Suitable for Australia

Commission Agreement

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What is a commission agreement?

A commission agreement is a legal document that sets out how and when commission payments will be made to an employee or contractor, typically for sales or marketing roles.
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When should you use a commission agreement?

Use a commission agreement whenever you want to establish clear, written terms for commission-based payments with an employee or external contractor involved in sales or marketing activities.
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What should be in a commission agreement?

A commission agreement should include payment structure, commission rates, performance targets, payment timing, termination conditions, and dispute resolution procedures tailored to your business needs.
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Frequently asked questions

Who can this agreement be used for?

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What commission structures can I set?

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Does this document cover dispute resolution?

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Are there protections for late commission payments?

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Can either party terminate the agreement?

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What are the key limitations of this agreement?

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What steps should I take after completing the agreement?

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View Sample Commission Agreement

Commission Agreement
risk level indicator at Low level

The Legal Risk Score of a Commission Agreement Template is Low

Our legal team have marked this document as low risk considering:

  • The document sets a fixed interest rate on overdue payments, which could be financially burdensome if the rate is high compared to standard industry practices.
  • The salesperson can be engaged either as an employee or as a contractor.
  • Either party may terminate for convenience.

Meet Our Users

Articles about Commission Agreement

A Guide to Sales Commission Structures
By Daniel Fane|Feb 17, 2020

A Guide to Sales Commission Structures

A good commission structure can help a business incentivise better employee performance. Here's our overview of the most popular commission structures.

How Do Consignment Agreements Work?
By Jack Sheedy|Apr 6, 2021

How Do Consignment Agreements Work?

Want to sell your goods without dealing with customers? Read this article to learn how to make consignment agreements work for you.

New "Fair Work Commission" Announced
By Dominic Woolrych|Sep 17, 2013

New "Fair Work Commission" Announced

'Fair Work Australia' (FWA) is no more. Now, the industrial relations tribunal will be known as the “Fair Work Commission”(FWC).

ICAC Overhaul - Every Watchdog Has Its Day
By Carmen Zhu|Nov 16, 2016

ICAC Overhaul - Every Watchdog Has Its Day

(Not so) Independent Commission Against Corruption? Find out about the changes ICAC may undergo.

Agency Relationships: What Are The Different Types?
By Michael Hoyle|May 24, 2024

Agency Relationships: What Are The Different Types?

Agency relationships involve an express (and sometimes implied) agreement where an agent will act in your best interests. There are three main types: ...

Mortgage Brokers Questioned By The Royal Commission
By Diana Liu|Apr 10, 2018

Mortgage Brokers Questioned By The Royal Commission

Do mortgage brokers hold your best interest at heart?

What is the Difference Between Deeds and Agreements?
By Angela Omari|Mar 15, 2022

What is the Difference Between Deeds and Agreements?

Interested in learning more about the differences between deeds and agreements? This blog will explain everything you need to know.

The Lawpath Blog
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The Lawpath Blog

Stay up to date with legal concepts, tactics and strategies for your business

Do I Need an ABN to Get Referral Commission?
By Paul Taylor|Dec 4, 2025

Do I Need an ABN to Get Referral Commission?

Whether you need an ABN to receive commission from referrals can depend on a broad number of factors. Read more what you need to know for finders fees here.

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