Commission
Workforce Management Glossary
Commission
What is commission?
Commission is money earned from the percentage of a sale or an amount received for reaching certain business targets. In some industries commission is an additional payment for salaried employees. In other instances workers are paid only on a commission basis. This means the more a worker sells the more they get paid.
Why do businesses implement commission pay?
Commission pay is often prevalent in the sales industries such as those working in shops or real estate agencies. It’s also common for recruiters to work on a commission basis. This structure of pay is implemented in these environments in order to motivate employees to close deals.
With earning power well and truly in the employee’s hands workers are motivated to work harder and smarter in order to achieve great outcomes. This often results in workers who are inherently knowledgeable and passionate about the product they are working with or the industry they are working in.
How can a business reflect commission pay in payroll?
When it comes to commission pay there are different payment structures to consider. Some businesses may opt for what is known as straight commission where the employee receives a fixed percentage of the sale price. Milestone commission where workers are paid for reaching a certain target may be another structure that a business implements.
Reflecting these commission structures in payroll can be difficult and time consuming. Offering one source of truth Roubler’s cloud payroll software stores data centrally so that key information such as a commission payment can be seamlessly directed to payroll in order to ensure that payroll processes remain quick and accurate.