How the bands work
Each rate applies only to the sales above its threshold, not to everything you sold. That single point is where most commission arithmetic goes wrong, in both directions.
Take a plan paying 3% up to $50,000 and 6% above it. Sell $80,000 and you earn 3% on the first $50,000 and 6% on the remaining $30,000 — $1,500 plus $1,800, so $3,300. You do not earn 6% of $80,000, which would be $4,800. Your effective rate is 4.1%, not 6%, and the table above shows that figure because it is the one worth knowing.
A worked example
Three deals in a year: $30,000 in January, $30,000 in February, nothing after. On annual bands the year totals $60,000, so $50,000 earns 3% and $10,000 earns 6% — $2,100. Grouped by month, each month shows $1,050, because the commission is earned against the year and shared out across the months that produced it.
Set those same bands to reset monthly and the total drops to $1,800. Neither month reaches $50,000 on its own, so nothing ever earns the higher rate. Same sales, same plan on paper, $300 apart — which is why the reset period is the first thing this page asks you.
What this does not do
- Draw recovery. If you take an advance against future commission, subtract any outstanding balance yourself. A recoverable draw is owed back; a non-recoverable one is not.
- Splits and team credit. Enter your own share of a shared deal, not the full contract value.
- Clawbacks. Cancellations, refunds and chargebacks are not modelled. Enter a negative amount if you want to net one off.
- Tax. Every figure is gross. Supplemental wages such as commission are often withheld at a flat federal rate, so your take-home will differ from these numbers.
- Quota accelerators tied to anything other than sales volume — attainment against a unit target, or margin rather than revenue.
Commission is wages
Once earned under the terms of your agreement, commission is wages rather than a bonus at the employer's discretion, and unpaid commission is a wage claim in most states. Several states require the agreement to be in writing and given to you — California's Labor Code § 2751 is the clearest example. If you do not have a written plan and your pay is disputed, that absence tends to count against the employer rather than you.
Overtime is a separate question, and usually not one commissioned staff need to ask. Outside sales roles are exempt from overtime outright, and many inside sales roles fall under the retail and service exemption in FLSA § 7(i). If you are non-exempt and earn commission, the commission has to be counted into the regular rate your overtime is calculated from, under 29 CFR 778.117 — the timesheet calculator handles the hours side of that.