A Sales Commission Letter to Employees is a crucial document used when establishing or modifying commission-based compensation arrangements in Indonesia. This document is typically implemented when hiring new sales staff, restructuring compensation plans, or updating existing commission structures. It serves as an official record of the commission arrangement between the employer and employee, detailing how commissions are earned, calculated, and paid. The letter must comply with Indonesian labor laws, particularly Law No. 13 of 2003 on Manpower and related regulations governing employment compensation. It's essential for creating transparency in sales compensation and avoiding potential disputes about commission payments. The document should be aligned with the company's sales strategies while ensuring fair compensation practices under Indonesian employment regulations.
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1. Employee Details: Full name, employee ID, position, and department of the employee
2. Effective Date: When the commission structure takes effect
3. Commission Structure: Basic explanation of how the commission system works
4. Commission Rates: Detailed breakdown of commission percentages or fixed amounts
5. Calculation Method: How commissions are calculated, including any thresholds or tiers
6. Payment Terms: When and how commissions will be paid
7. Performance Targets: Any sales targets or quotas that affect commission earnings
8. Acknowledgment: Space for employee signature and date to confirm understanding and acceptance
1. Clawback Provisions: Include when the company needs to recover commissions in cases of returns or cancelled orders
2. Team Commission Structure: Include when employee is part of a sales team with shared commissions
3. Territory Assignment: Include when employee is assigned to specific geographic or customer territories
4. Non-Solicitation Clause: Include when there's a need to protect customer relationships post-employment
5. Dispute Resolution: Include when specific procedures for resolving commission disputes are needed
6. Commission Caps: Include when there are maximum limits on commission earnings
1. Commission Rate Table: Detailed table showing all commission rates, tiers, and applicable products/services
2. Calculation Examples: Sample calculations showing how commissions are computed in various scenarios
3. Product/Service List: List of products/services eligible for commission and their specific rates
4. Performance Metrics: Detailed breakdown of performance targets and their measurement criteria
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