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I have a software business based in Portland, OR. Am about

to recruit first independent commission...
I have a software business based in Portland, OR. Am about to recruit first independent commission only rep, but we're haggling over commissions if he leaves, or we terminate the agreement. He is looking to get 100% of the commissions owed over the lifetime of that contract - even though he would not be there to manage that account. So if he got a 3 year deal, and left a month after the deal closed he would continue to get the commission for 2yrs and 11 months even though he was not there. Is this a statute somewhere? I would prefer to cap this at a year ie. get commissions for 12 months OR remainder of contract whichever is shorter. Advice pls
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Answered in 9 minutes by:
5/4/2013
Dimitry K., Esq.
Category: Business Law
Satisfied Customers: 41,221
Experience: Run my own successful business/contract law practice.
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Thank you for your question. Please permit me to assist you with your concerns.

What you are describing is not statutory but purely contractual. In essence who two or more independent parties choose to agree as the terms of their business relationship, provides the terms are not against state or federal law, are binding. His demand, while potentially unreasonable from your perspective, is not illegal and is not in violation of any state law. Consequently you as an another independent contractual party can choose to counter-offer with terms you deem to be more fair and acceptable to you, such as clauses on willful termination, limits on commission, or other terms that you may find to be fairer to your position. What you prefer to do is likewise legal and permitted, provided that he agrees. Here, state law would not really help, you simply need to sit down and negotiate for terms that end up being fairer and more acceptable to all of the parties involved to this potential relationship. I will say that at least based on industry standards the constant and total commission even after termination is almost never done. Typically in cases of 'voluntary termination', that is when the other person chooses to leave, they tend to forgo part or most of their owed commission, but in cases of being terminated without good cause, then more protection and more commission would be granted. All of these are simply conditions and clauses to haggle over, none of this is statutory.

Good luck.

Dimitry K., Esq.
Category: Business Law
Satisfied Customers: 41,221
Experience: Run my own successful business/contract law practice.
Verified
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