What is a commission dispute?
A commission dispute is a disagreement between a sales rep and the company about commission. It can be about the amount, who should be credited for a deal, when commission is earned, or whether a clawback is justified. It usually starts with an objection to a commission statement.
Most disputes are not about disagreeing with the rules, but about rules that were not written down clearly enough, or a rep who cannot see how the number was calculated.
Common causes
| Cause | Example | Prevention |
|---|---|---|
| Crediting | Two reps worked on the same customer | A written crediting rule |
| Timing | Is commission earned at signature or at payment? | An earning point in the plan |
| Data errors | Wrong amount or owner on the deal in the CRM | Statements that show the underlying deals |
| Changes after payout | The customer gets a discount or cancels | Clear rules for corrections and clawbacks |
| Plan changes | The rate changed mid-period | Notice and written acceptance |
Example
A $50,000 deal is credited 50/50 between two reps. One rep believes 70/30 was agreed. The commission rate is 8%.
| Split | Rep's credit | Commission (8%) |
|---|---|---|
| 50/50 (as credited) | $25,000 | $2,000 |
| 70/30 (as the rep claims) | $35,000 | $2,800 |
The dispute is about $50,000 × 20% × 8% = $800. If the split was agreed in writing, it is settled in minutes. If not, it is one person's word against another's.
How to handle a dispute
- Objection: the rep objects in writing and points to the specific line on the statement.
- Evidence: both sides pull the data: the deal in the CRM, invoices and the commission agreement.
- Decision: a person named in advance, for example the sales manager and finance together, decides.
- Fix: if the rep is right, the amount is corrected on the next statement.
Put the process and a deadline for objections in your commission policy. For more advice, see the guide to avoiding commission disputes.
Danish rules in brief
- Commission is pay. A claim for commission is generally time-barred after 3 years under the Danish Limitation Act, section 3.
- The agreement decides. Disputes are settled based on the employment contract and the commission agreement. Unclear terms may be interpreted against the party that wrote them.
- Commercial agents have specific rights to statements and information under the Danish Commercial Agents Act. See commercial agent and travelling salesperson.
This is general guidance. For larger amounts, talk to a lawyer, your employers' association or the rep's union.
FAQ
What should I do if my commission is wrong?
Object in writing as soon as possible and refer to the specific deal and line on the statement. Follow the process in your commission policy or agreement.
How long do you have to object?
It depends on your agreement, which may set an internal deadline. The claim itself is generally time-barred after 3 years in Denmark. Do not wait: the longer it takes, the harder it is to document.
How do you prevent commission disputes?
With clear written rules and statements where reps can see every deal and every calculation. When reps can follow the number as it moves, errors are caught before they turn into disputes.
Fewer disputes with Prowi
In Prowi, each rep's commission statement updates live through the period, and the calculation can be seen deal by deal in the mobile app. When the period closes, the statement awaits approval and can be commented on, so objections are handled before the amount goes on to payroll. Book a demo.
In Prowi
Every term on this page is a rule you can write into a commission model in Prowi. The model reads the deal from HubSpot the second it closes, applies the rule, and the rep sees the result on their phone before the day is over.