Commission-based compensation

Commission-based compensation is a payment structure where employees earn money based on the sales or performance they generate rather than a fixed salary. For example, a salesperson might receive a percentage of each sale they make. This system incentivizes employees to work harder to increase their earnings, aligning their financial interests with the company's success. While commission can lead to higher income potential, it also means that earnings can fluctuate, depending on individual performance and market conditions.