Commission Only Contract Template for South Africa

The Commission Only Contract is essential for businesses operating in South Africa that engage individuals or entities on a pure commission basis. This document type is specifically designed to establish clear parameters for performance-based compensation relationships while ensuring compliance with South African employment and contract law. It's particularly relevant when engaging sales representatives, agents, or service providers who will be remunerated solely through commission earnings. The contract addresses crucial elements such as commission structures, performance targets, territory assignments, and compliance requirements under various South African statutes including the Basic Conditions of Employment Act and Labour Relations Act. This agreement type is distinct from standard employment contracts and must carefully establish the independent contractor relationship while providing appropriate protections for both parties.

1. Parties: Identification of the Principal/Company and the Commission Earner, including full legal names, registration/ID numbers, and addresses

2. Background: Context of the agreement, nature of the Principal's business, and the purpose of engaging the Commission Earner

3. Definitions: Detailed definitions of key terms used throughout the agreement, including 'Commission', 'Services', 'Territory', 'Customers', etc.

4. Appointment and Status: Clear statement of the Commission Earner's appointment and independent contractor status, specifying non-employment relationship

5. Duration: Term of the agreement, including commencement date, period, and renewal terms if applicable

6. Services: Detailed description of services to be provided by the Commission Earner

7. Commission Structure: Detailed explanation of commission calculations, rates, and conditions for earning commission

8. Payment Terms: Terms and timing of commission payments, payment methods, and handling of expenses

9. Performance Targets: Minimum performance requirements and any associated consequences

10. Obligations of the Commission Earner: Specific duties, responsibilities, and conduct requirements

11. Obligations of the Principal: Company's commitments, support, and resources to be provided

12. Intellectual Property: Ownership and protection of intellectual property, including customer data and company materials

13. Confidentiality: Protection of confidential information and trade secrets

14. Non-Compete and Non-Solicitation: Restrictions on competitive activities and customer solicitation

15. Termination: Grounds and procedures for termination, notice periods, and consequences

16. General Provisions: Standard legal clauses including governing law, dispute resolution, and entire agreement