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A Commission Agreement sets out how and when salespeople or agents will get paid for successful sales or deals. In Indonesia, these contracts spell out the commission rate, payment schedule, and specific goals that trigger commission payments - following rules set by Indonesian labor laws and the Civil Code.

The agreement protects both parties by clearly defining what counts as a successful sale, when commissions are earned, and how disputes get resolved. It's especially common in real estate, insurance, and retail sectors, where companies need to motivate their sales teams while staying compliant with local employment regulations on performance-based compensation.

Use a Commission Agreement when your business needs to establish clear compensation terms with sales representatives, agents, or brokers in Indonesia. This document becomes essential before starting any sales-based relationship where payment depends on successfully closing deals or reaching specific targets.

The timing is particularly important for real estate agencies, insurance firms, and retail businesses launching new sales programs. Having this agreement in place prevents disputes over commission calculations, payment schedules, and performance metrics. Indonesian law requires written documentation of performance-based pay structures, making this agreement crucial for protecting both the company and its sales force.

• Commission Pay Agreement: Basic template for straightforward commission structures, typically used for in-house sales teams
• Independent Contractor Commission Agreement: Specialized version for external agents, including self-employment provisions
• Commission Payment Agreement: Focuses on detailed payment terms, schedules, and calculation methods
• Commission Contract Agreement: Comprehensive version with extensive performance metrics and territory definitions
• Sales Representative Contract: Combines commission terms with broader sales responsibilities and territory rights

• Sales Organizations: Companies across retail, real estate, and insurance that need to manage commission-based staff
• Sales Representatives: Employees or contractors who earn commissions for successful sales or transactions
• Legal Teams: In-house counsel or external lawyers who draft and review Commission Agreements for compliance
• HR Departments: Managers who implement and oversee commission structures within Indonesian labor regulations
• Finance Teams: Staff responsible for calculating, tracking, and processing commission payments
• Business Owners: Small to medium enterprise leaders who directly manage commission-based relationships

• Basic Details: Gather sales representative's information, role description, and territory assignments
• Commission Structure: Define exact commission rates, payment thresholds, and calculation methods
• Performance Metrics: Outline specific sales targets, quotas, and measurement periods
• Payment Terms: Determine payment schedules, processing methods, and any minimum thresholds
• Legal Requirements: Check Indonesian labor laws regarding commission-based compensation
• Documentation: Collect necessary business licenses and tax registration details
• Agreement Generation: Use our platform to create a legally-sound Commission Agreement that includes all required elements

• Party Details: Full legal names, addresses, and business registration numbers of both parties
• Commission Structure: Clear calculation methods, rates, and conditions for earning commission
• Payment Terms: Specific timing, method, and currency of commission payments
• Performance Metrics: Defined sales targets, evaluation periods, and reporting requirements
• Territory Rights: Geographic or customer segment boundaries for sales activities
• Term and Termination: Agreement duration and conditions for ending the relationship
• Dispute Resolution: Process for handling disagreements under Indonesian law
• Confidentiality: Protection of business secrets and customer information

A Commission Agreement differs significantly from an Agency Agreement in several key aspects, though both involve business relationships. While Commission Agreements focus specifically on sales-based compensation, Agency Agreements establish broader representation rights and responsibilities.

• Scope of Authority: Agency Agreements grant broader powers to represent and act on behalf of the principal, while Commission Agreements strictly define sales targets and compensation terms
• Payment Structure: Commission Agreements focus solely on performance-based compensation, whereas Agency Agreements may include fixed fees, expenses, and various payment types
• Legal Obligations: Agency Agreements create fiduciary duties and broader legal responsibilities under Indonesian law, while Commission Agreements primarily govern sales performance and payment terms
• Duration and Flexibility: Agency Agreements typically involve longer-term relationships with broader obligations, while Commission Agreements can be more focused and project-specific