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Boss asking for thoughts on a new commission , no idea!

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911bill911bill Forumite
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Hi All,
Hope you are all well!
So, a bit of background, as brief as poss.
I am in the middle of moving home, well, I have a buyer for mine, had found a new home and put offer forward. However, as I was furlough, my basic is pretty low and I was just getting 100% of that, no commssion. So, while I was furloughed, I emailed my boss to make sure I am getting full pay at the end of July (I started working the start of July) plus the commission I would have earned while on furlough (something he said he will do at the start of lockdown).
He replied;

I will need to look at what we can do, whilst still claiming furlough money for you in July.  The rules in respect of flexible furloughing changed on 1st July, but I haven't had the need to look at how that impinges of payment of commission.


A few days later, I end up having a phone call about something else and on the tail end, he said we will have a sit down with me as he wanted to change the commission scheme as it is a pretty old school model which I inherited and it takes him 6 hours to figure out every month blah blah.  He followed this call with an email;

As discussed earlier, I wish to revamp the commission basis on which you are paid.

Part of the problem with the furlough and lock down, is that your commission is non-contractual, and is based on a model from a long time ago.  As I mentioned, this is not planned to cut down your earnings, it is targeted at increasing the income of COMPANYXXX.  Additionally, your base salary is up for discussion, which I am aware has not be revisited since October 2016, however your commission payments have balanced that.  

Please look at options that you may wish to include, and how you would want it to work, for both you and COMPANYXXX.  Depending on  what we can put in place, I would hope to agree an early implementation of the new scheme, why may work in your favour, especially if we get a second spike of the virus. (Hopefuly we don’t, however….)

Thanks and I will see you, provisionally, on Friday morning..


So the sit down was meant to happen tomorrow but he has since broken his arm so is going for an opp, so we are doing it monday.. He emailed again;


My op is now hopefully tomorrow morning,  so I will have to cancel meeting with you.  Let's move it to Monday, time to be confirmed,  however please email me your thoughts on the new commission basis, so I can look it over

 

That's the latest.

So to explain, I am paid £22,000 basic and have made around £48,000 in commission the last few years. We sell a few different products, some are paid for monthly, some are paid for upfront with an annual service charge. The later provides quite a large lump. I get 10% on everything, item, annual maintenance charge. 1 items sells a lot more than other other as it is a more popular product, the other doesn't sell so fast and isn't that much of an earner for me. Some items are things which were sold by a guy I took over from but it is still my role to hand hold them so I do think I should be entitled to it, some I don't but that's because they just get on with it. 


I really do not know what he wants me to go back to him with? I do not want to come away earning less than £70,000 and I have to look longer term, I am pretty happy with the model, the only time it has been a negative is in this furlough period where I just get my low basic but I can live as it is just temporary.

Can anyone help me with what I should be saying back? Or offer any good ideas?

Thanks!!

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Replies

  • jonnygee2jonnygee2 Forumite
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    Difficult to say without knowing a lot more about your situation.

    But, they seem keen on growth. 10% commission is quite low. Perhaps you could suggest 5% commission on repeated orders, 30% commission on orders from new companies for the first year, with a basic of 30K? Or something like that?  Obviously you need to work out what that does / could look like.  But it would provide incentive for you to go win some big new contracts.


  • edited 17 July at 11:35PM
    911bill911bill Forumite
    38 posts
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    edited 17 July at 11:35PM
    Thank you 

    It could work if the basic was raised to prevent me earning less, which I don’t want. 

    My boss made a point of working out the commission taking a long time, so if I go back with a lower rate for repeated purchases and higher for new, I don’t think that will help his issue with it taking a long time. That’s his problem really but I really don’t know why he is asking me to come up with sometbing. I just can’t think of a better method or what I should be asking for to benefit me.. 

    frustrating as I don’t want to meet with him and say, I couldn’t think of anything.. 
  • MaterialGirl*MaterialGirl* Forumite
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    What about a high basic income of 42k or so and 5% on any commissions?
    Are you the only member of staff being asked to change your commission basis? Is it up to your manager alone to decide your new pay structure?
  • BrynsamBrynsam Forumite
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    911bill said:

    My boss made a point of working out the commission taking a long time, so if I go back with a lower rate for repeated purchases and higher for new, I don’t think that will help his issue with it taking a long time. That’s his problem really but I really don’t know why he is asking me to come up with sometbing. I just can’t think of a better method or what I should be asking for to benefit me.. 

    If one of his major beefs is that it takes a long time, then maybe someone needs to help him set up appropriate accounting records - which might not be much more than a decent spreadsheet. That alone shouldn't be a driving factor in changing the commission structure.

    Commission is designed to motivate staff and reward them for increasing the company's income. Good employees sell more so earn more commission - which is fine in a normal world, but COVID-19 is not normal, so there needs to be more flexibility on both sides (albeit temporarily) to ensure the company remains alive and well.

    Why is he claiming furlough pay in July now you are back at work?  
  • Grumpy_chapGrumpy_chap Forumite
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    I don't understand this part...
    911bill said:
    while I was furloughed, I emailed my boss to make sure I am getting full pay at the end of July (I started working the start of July) plus the commission I would have earned while on furlough (something he said he will do at the start of lockdown).


    Normally commission is based upon some specific target (usually sales order value booked) being met.   The commission is paid for out of the profit associated with the order value won.  While you were on furlough, you were not working so there would be no target met and no commission.  The commission you would have earned while on furlough is simply not there for the company to pay to you.
  • 911bill911bill Forumite
    38 posts
    10 Posts First Anniversary
    I don't understand this part...
    911bill said:
    while I was furloughed, I emailed my boss to make sure I am getting full pay at the end of July (I started working the start of July) plus the commission I would have earned while on furlough (something he said he will do at the start of lockdown).


    Normally commission is based upon some specific target (usually sales order value booked) being met.   The commission is paid for out of the profit associated with the order value won.  While you were on furlough, you were not working so there would be no target met and no commission.  The commission you would have earned while on furlough is simply not there for the company to pay to you.
    Hi,

    we have regular payments come in from sales where the customer wishes to pay monthly rather than outright, Also on annual maintenance. I get commission on those and they were still being paid during my time on furlough. 
  • 911bill911bill Forumite
    38 posts
    10 Posts First Anniversary
    Brynsam said:
    911bill said:

    My boss made a point of working out the commission taking a long time, so if I go back with a lower rate for repeated purchases and higher for new, I don’t think that will help his issue with it taking a long time. That’s his problem really but I really don’t know why he is asking me to come up with sometbing. I just can’t think of a better method or what I should be asking for to benefit me.. 

    If one of his major beefs is that it takes a long time, then maybe someone needs to help him set up appropriate accounting records - which might not be much more than a decent spreadsheet. That alone shouldn't be a driving factor in changing the commission structure.

    Commission is designed to motivate staff and reward them for increasing the company's income. Good employees sell more so earn more commission - which is fine in a normal world, but COVID-19 is not normal, so there needs to be more flexibility on both sides (albeit temporarily) to ensure the company remains alive and well.

    Why is he claiming furlough pay in July now you are back at work?  
    Thanks for taking the time to reply to me.

    the 6 hours to sort my commission is a bit of an exaggeration in my mind, I couldn’t care if it took him 1 week to work it out, that’s his issue and it’s not that hard. I keep my own spreadsheet to keep track. I will exclude that from my mind when talking to him. 

    I’m not sure on claiming furlough, that is what brought this all on. I knew I was returning to work on 1st July. I get paid at the end of July, so I just emailed him to ask if I would be getting the past 3 months commissions in julys pay, which I thought was my regular salary, not furlough. Slightly confused there. He is known to be a bit crafty and a bit shrude.. so I do need to be prepared but I am just finding it difficult on how to go into this meeting. 
    Although Covid has hit, we only had 1 customer ask for a temp reduction in invoices, which we did as they are a valued long term customer. 
  • 911bill911bill Forumite
    38 posts
    10 Posts First Anniversary
    What about a high basic income of 42k or so and 5% on any commissions?
    Are you the only member of staff being asked to change your commission basis? Is it up to your manager alone to decide your new pay structure?
    This was my only idea to be honest, I haven’t worked out the figure but there will be a balance somewhere but I can’t see how the adjustment makes any difference to him and what he wants to achieve as seen in his emails? He will stil spend 6 hours and I don’t think it makes a difference to company / me aside from getting more in furlough should we see a return to it.

    i am the only one on commission and it is up to my director along with me I guess.. I just can’t place his thinking and what he wants aside from cutting my commission but raising basic but Without introducing tier’d commision on new/repeating sales or on different products, that 6 hours which he made a point of will certainly grow! 
     
    Tough one!

  • 911bill911bill Forumite
    38 posts
    10 Posts First Anniversary
    Thanks all for your help on this so far!

    it has become a bit of a worry as I feel unprepared 
  • Manxman_in_exileManxman_in_exile Forumite
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    I'm probably being very naiive here, but is it quite common for people who receive commission on sales to have a 30:70 split between basic pay and commission?  If I became accustomed to earning £70k pa, I think I'd be a bit anxious if £48k of that was commission.
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