Salesperson leaving the company? Commissions due?

Salesperson leaving the company? Commissions due?

Written By Jeffrey Gitomer
@GITOMER

KING OF SALES, The author of thirteen best-selling books including The Sales Bible, The Little Red Book of Selling, and The Little Gold Book of Yes! Attitude. His real-world ideas and content are also available as online courses at www.GitomerLearningAcademy.com.

Quit? Changing jobs? Get fired? Are you owed money for commissions? Are you sure you’re going to get paid? I’m not.

Some companies have pay problems with departing salespeople. How many? I’d just like to have the interest for one day on the commission money not paid salespeople who quit or got fired.

Will it happen to you? Maybe. Take a look at how much turnover exists on your sales force. That may tell a tale. If there’s low sales staff turnover, there’s a high probability of full payment without incident. If there’s a revolving door of new salespeople, there’s a low probability of payment without incident.

Be sure you know or do the following…

  • Keep accurate records while employed. A spread sheet on your accounts, date sold, amount of commission due and date paid. Records don’t matter when everything’s smooth. When you’re quitting or are fired your records will help you or hang you.
  • Know your company’s policy. If it’s in writing, it will be enforced to the letter. Payments, benefits, and special conditions. If the policy is not written, prepare for the worst.
  • Know your boss. Watch what happened when others have left that’s what will happen to you. (“Oh he wouldn’t do that to me,” you say? “Oh yes he will,” I say.
  • Know if there are charge backs. For materials, expenses, prior draws, canceled sales, sales kits or samples.
  • Pay attention to every letter of your contract. If you signed one, it will be enforced to the letter. Beware of “noncompete” clauses.

Contacting customers and talking to others…

  • Don’t burn the bridge with your customer. Contact your customers to arrange a smooth transition. Tell them it was a pleasure serving them. Compliment your old company or say nothing.
  • Don’t burn the bridge with your employer. Leave on great terms if you can. Even if your employer is a butthead (sorry Beavis), you are a professional. Never get into a fight with a pig. You both get dirty, the pig enjoys it, and an outsider may mistake you for the pig.

Getting the money you feel is due you…

  • Will anyone else have to do work to complete the sale? Loose ends, paper work, training, installation.
  • Get all you can get the day you leave.
  • Giving notice may or not work. Look at the policy, look at the boss.
  • ASK YOURSELF: Have I really earned it? Is this commission really mine? Is this account really mine? The worst mental games played by salespeople are the ones they play on themselves.
  • If it is yours beyond a doubt, fight like hell. It’s your money, you earned it. Get a lawyer, go to the state wage and hour labor division and get hostile. (Employers hate those audits because they usually uncover other sins.)
  • Get your separation agreement in writing. What accounts will be paid what amounts, and when. Get it signed by the boss. If there is a reluctance or refusal to sign you’re probably in for a fight. Send a copy of your version by certified mail to your employer and get a lawyer or go to a government official or both fast. DON’T WAIT UNTIL YOU LEAVE TO TAKE LEGAL ACTION.

If you quit or are fired and your terms of employment are not in writing,
you’re probably in for a fight.

Note well…Your greatest power to collect moneys due you is while you’re still on the job. After you leave you will become the scapegoat for anything that has ever gone wrong in the company since it started operations, and you will be the lowest priority to be paid.

Prevention…Sign an agreement before you start work. Agree on exactly what you’re paid for and when you’re paid for it. Sales is like anything else in business. If you don’t write it down before you start, don’t start.

Here are 10.5 important factors that must be discussed and committed to writing BEFORE you begin to work for someone…

  1. What is expected of you. Performance and professionalism.
  2. Who pays for what. (Customer entertainment, travel, brochures, postage, phone bills).
  3. What the employer will provide (training, benefits, office, advertising).
  4. How and when commissions are paid.
  5. Are there charges for anything (samples, kits).
  6. Are there charge-backs for lost or canceled sales.
  7. What length of time after employment that commissions are paid.
  8. If there’s a draw against commissions, and you are overdrawn at the time of termination, who owes whom.
  9. What happens to commissions due if you terminate employment.
  10. Is there any difference between being fired and resigning.

10.5 What happens if you go to work for a competitor? Are there any competitive restrictions. (You might as well find out now. The odds of that happening are about 50%.)

Salespeople are always trying to move up the ladder. That’s why they get into sales in the first place. The key is to build a winning career by successfully moving forward – not create repeated patterns of losing battles.

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