Employee Commission Agreement Template for Indonesia

The Employee Commission Agreement serves as a crucial document for businesses operating in Indonesia that compensate their employees partly or fully through commission-based structures. This agreement is essential for companies looking to implement transparent and legally compliant commission schemes while adhering to Indonesian labor laws and regulations. It should be used whenever an employer wishes to establish a formal commission structure for sales-related positions, ensuring clear understanding of commission calculations, payment terms, and performance expectations. The document incorporates requirements from Indonesian employment legislation, particularly Law No. 13 of 2003 on Manpower and Government Regulation No. 78 of 2015 on Wages, while providing detailed frameworks for commission-based compensation systems.

1. Parties: Identification of the employer company and the employee, including their respective addresses and registration details

2. Background: Context of the agreement, including the employee's role and the purpose of implementing a commission-based compensation structure

3. Definitions: Key terms used in the agreement, including 'Commission', 'Sales', 'Gross Revenue', 'Target', 'Commission Period', etc.

4. Scope of Employment: Overview of the employee's position, duties, and responsibilities in relation to commission-earning activities

5. Commission Structure: Detailed explanation of how commissions are earned, including qualification criteria and commission rates

6. Calculation Method: Specific methodology for calculating commissions, including formulas, qualifying sales, and any adjustments

7. Payment Terms: Timing and method of commission payments, including any minimum thresholds and payment schedule

8. Targets and Quotas: Any applicable sales targets or quotas that affect commission earnings

9. Adjustments and Clawbacks: Circumstances under which commissions may be adjusted, including returns, cancellations, or uncollected payments

10. Reporting and Documentation: Requirements for sales reporting, record-keeping, and commission statements

11. Term and Termination: Duration of the agreement and treatment of commissions upon employment termination

12. Confidentiality: Protection of confidential information related to sales, customers, and commission structures

13. Governing Law: Specification of Indonesian law as governing law and relevant jurisdictional matters