Charles,

I found your short article about the #1 Rule To Avoid Commission Cuts and found it to hit very close to home. I have a current situation with a principal located overseas that repeatedly takes a very lackadaisical approach to paying commissions due on time. When commissions are paid, there is a very vague accounting of the rate of commission. It does become one of these “take or leave it” situations.

Something I thought might be worth pointing out is that my state’s Sales Representatives Contractual Relations Act which protects reps against principals who don’t respect our rights. In the act, (as I assume you are probably very aware) it is stipulated that a principal is legally required to provide:

  1. An accounting of the orders for which payment is made, including the customer’s name and invoice number.
  2. The rate of commission on each order.
  3. Information relating to any charge backs included in the accounting.

I have recently brought this to the attention of my “lackadaisical” principal in a very strategic context, using the guise of the possible ramifications that might fall on them regarding such entities as my local taxing authority. I have given an example of my possibly being audited and having to tell the my local taxing authority that, “Though I have repeatedly insisted on detailed accounting of incoming commissions, my principal has still not provided this.”

I know that perhaps it might sound like a “threat” to a principal but I think that reps need to know that some state legislatures have actually has put such an Act in place for our protection…

Just my two cents.

VERY glad to be a member of MANA, and I thank you for your time in hearing my angle!

MANA Rep Member Writes About Commission Protection

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