SECTION 1. THE EMPLOYMENT CONTRACT FOR SALES REPRESENTATIVES

The provisions of the Employment Contract Act regarding white-collar workers also apply to sales representatives, except for the rules on the competition clause. However, since this group of employees deliver very specific services, the Employment Contract Act devotes a separate title (Title IV) to them.

WHAT IS A SALES REPRESENTATIVE?

The employment contract for sales representatives is the agreement under which an employee, i.e. the sales representative, undertakes, in return for wages, to find and visit customers with a view to negotiating and completing transactions, with the exception of insurance policies, under the authority of, chargeable to, and on behalf of, one or more principals.

A number of persons working for principals and performing activities bearing resemblance to those of sales representatives are nonetheless not considered to be sales representatives. The legislator specifically stipulated this for: persons working in the insurance business, agents, brokers, concessionaires, middlemen allowed to pass on their orders to whomever they like, and the commercial agents bound to their employer by a contracting agreement within the meaning of the law regarding an agency agreement, a mandate for wages or any other agreement pursuant to which a commercial agent does not act under the authority of his/her principal.

Despite any explicit or implicit provision of the agreement, a contract concluded between a principal and a middleman, whatever his description, is considered to be an employment contract for sales representatives unless proof to the contrary is given. Thus, the judge is not bound by the qualification the parties themselves allocated to the contract.

THE SALES REPRESENTATIVE's WAGES

The wages of a sales representative consist of a fixed salary, a commission, or partly a fixed salary and partly commission.

Commission: concept and basis for calculations

A commission is a variable wage calculated on the basis of the turnover made by the sales representative, the work done, etc.

A distinction is made between direct and indirect commissions.

Direct commissions are due for orders completed by the sales representative himself/herself. Indirect commissions are due for orders completed without his/ her intervention but for which remuneration is due because an exclusivity clause was included in the agreement.