Commission Based Consulting Agreement for the United Kingdom

Commission Based Consulting Agreement Template for England and Wales

A Commission Based Consulting Agreement is a legally binding contract under English and Welsh law that establishes a commercial relationship between a consultant and a client company, where the consultant's compensation is primarily or partially based on achieved results or sales. The agreement defines the scope of services, commission structure, performance metrics, and essential terms while maintaining the consultant's independent contractor status. It includes provisions for intellectual property rights, confidentiality, and data protection in accordance with UK legislation.

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What is a Commission Based Consulting Agreement?

The Commission Based Consulting Agreement is designed for situations where organizations wish to engage external expertise while aligning compensation with performance outcomes. This document, governed by English and Welsh law, provides a comprehensive framework for defining the consulting relationship, commission structures, and performance expectations. It's particularly valuable when companies seek to incentivize consultants through results-based compensation while maintaining clear independent contractor status. The agreement includes essential provisions for service delivery, payment terms, intellectual property rights, and compliance with UK regulatory requirements.

What sections should be included in a Commission Based Consulting Agreement?

1. Parties: Identification and details of contracting parties

2. Background: Context and purpose of the agreement

3. Definitions: Key terms used throughout the agreement

4. Scope of Services: Detailed description of consulting services to be provided

5. Commission Structure: Calculation and payment terms for commission

6. Term and Termination: Duration and termination provisions

7. Obligations of Parties: Key responsibilities of both parties

8. Independent Contractor Status: Confirmation of non-employment relationship

9. Confidentiality: Protection of confidential information and trade secrets

10. Intellectual Property: Ownership and rights to intellectual property created during the engagement

11. Data Protection: Compliance with UK GDPR and data protection requirements

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

What sections are optional to include in a Commission Based Consulting Agreement?

1. Non-Compete: Restrictions on competitive activities during and after the agreement term

2. Performance Metrics: Specific KPIs and targets for measuring consultant performance

3. Territory Rights: Geographical limitations and exclusivity of services

4. Insurance Requirements: Specific insurance coverage requirements for the consultant

5. Force Majeure: Provisions for handling events beyond parties' reasonable control

What schedules should be included in a Commission Based Consulting Agreement?

1. Schedule 1 - Services Description: Detailed scope of consulting services and deliverables

2. Schedule 2 - Commission Structure: Detailed commission calculations, examples, and payment schedules

3. Schedule 3 - Service Level Agreement: Performance standards, metrics, and quality requirements

4. Schedule 4 - Approved Expenses: List of reimbursable expenses and approval process

5. Appendix A - Reporting Requirements: Format, content, and frequency of activity and performance reports

Authors

Alex Denne

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

Jurisdiction

England and Wales

Publisher

Genie AI

Cost

Free to use
Clauses
Industries

Commercial Agents (Council Directive) Regulations 1993: Key legislation governing relationships with commercial agents, including commission arrangements and termination rights

Supply of Goods and Services Act 1982: Establishes implied terms for contracts involving the supply of services, including the requirement to perform services with reasonable care and skill

Contracts (Rights of Third Parties) Act 1999: Governs how third parties may enforce terms of a contract

Unfair Contract Terms Act 1977: Regulates clauses that exclude or limit liability in contracts

Consumer Rights Act 2015: Relevant if the consulting arrangement could involve B2C relationships

Employment Rights Act 1996: Important for establishing clear distinction between consultant and employee status

IR35 Legislation: Tax legislation determining whether a consultant should be treated as an employee for tax purposes

Working Time Regulations 1998: May be relevant if the consulting arrangement involves specific working time commitments

UK GDPR: Regulates the processing and handling of personal data in the UK

Data Protection Act 2018: UK's implementation of data protection requirements, complementing UK GDPR

Value Added Tax Act 1994: Governs VAT obligations for consulting services

Copyright, Designs and Patents Act 1988: Protects intellectual property rights in works created during the consulting engagement

Trade Marks Act 1994: Relevant for protecting and using trademarks in the consulting relationship

Bribery Act 2010: Anti-corruption legislation affecting business relationships and commission arrangements

Modern Slavery Act 2015: May be relevant for larger consulting arrangements or specific sectors

Competition Act 1998: Ensures consulting arrangements don't violate competition law principles

Enterprise Act 2002: Additional competition law considerations for business arrangements

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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