Draw Salary Application

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Draw against commission is a salary plan based completely on an employee's earned commissions. An employee is advanced a set amount of money as a paycheck at the start of a pay period. At the end of the pay period or sales period, depending on the agreement, the draw is deducted from the employee's commission.
A draw is an amount of money the employee receives for a given month before his monthly sales figures are calculated. After the employee's sales figures for the month are calculated, the employee may keep any amount of commission he earns that exceeds the draw amount.
Salary is direct compensation, while a draw is a loan to be repaid out of future earnings. A draw is usually smaller than the commission potential, and any excess commission over the draw payback is extra income to the employee, with no limits on higher earning potential.
Draw against commission is a salary plan based completely on an employee's earned commissions. An employee is advanced a set amount of money as a paycheck at the start of a pay period. At the end of the pay period or sales period, depending on the agreement, the draw is deducted from the employee's commission.
A draw is an advance against future anticipated incentive compensation (commission) earnings. With a draw versus commission payment, typically the only way for the sales employee to earn a higher salary is to meet or exceed specific sales goals in order to earn a higher amount than the draw rate.
The employer cannot recover the money from a future commission, so the only way to recover the draw is to demand the employee return the money already paid an unlawful kickback. Based on that principle, the panel held that the repayment-upon-termination policy was unlawful.
Salary is direct compensation, while a draw is a loan to be repaid out of future earnings. A draw is usually smaller than the commission potential, and any excess commission over the draw payback is extra income to the employee, with no limits on higher earning potential.
Draw against commission is a salary plan based completely on an employee's earned commissions. An employee is advanced a set amount of money as a paycheck at the start of a pay period. At the end of the pay period or sales period, depending on the agreement, the draw is deducted from the employee's commission.
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