Piece rates & commission payments

Some employees can be paid piece rates or commission payments.

Employees paid piece rates and commission payments are paid by results instead of getting an hourly or weekly pay rate. This means the amount the employee earns each week will vary depending on how much work they do.

    Piece rates

    A piece rate is where an employee gets paid by the piece. This means the employee gets a pay rate for the amount picked, packed, pruned or made.

    When piece rates are paid, they apply instead of the hourly or weekly pay rate. An employee can be hired to work a mix of piece rates and hourly rate shifts.

    When can an employee be paid piece rates?

    An employee can be paid piece rates when:

    • an award or registered agreement allows for piece rate payments
    • the employee isn’t covered by an award or registered agreement and they get a pay rate based on how much work they do.

    There has to be a written and signed piecework agreement setting out the pay rate per piece and how it is measured. An employer has to keep the agreement as part of their records and give a copy to the employee. 

    If the agreement is varied, it must be agreed to in writing by the employee and employer.

    Commission payments

    A commission payment is an amount paid to an employee based on how much they sell.

    Normally, the commission payment is calculated as a fee or percentage of the employee’s total sales. A commission payment can be called a ‘bonus’ or ‘incentive payment’.

    A commission payment can:

    • be paid as an extra incentive on top of an employee’s pay or
    • make up an employee’s whole wage (commission only payments).

    When can an employee be paid commission as an incentive?

    An employee can be paid commission as an incentive at any time.

    An award or registered agreement can set out rules about how this can be done.

    When can an employee be paid commission only?

    An employee can be paid on a commission only basis when an award, enterprise agreement or other registered agreement states an employee can be paid this way.

    For rules about paying award and agreement free employees on a commission only basis see Award and agreement free wages and conditions.

      An award or registered agreement can set out specific rules about how the commission can be paid.

      Find information about piecework arrangements and commission payments in your award by selecting from the list below.

      Vehicle Award

      Based on what you've told us, it looks like you're covered by the Vehicle Manufacturing, Repair, Services and Retail Award 2010 [MA000089].

      Piece rates

      An employee can't be paid pieceworker rates under the Vehicle Award

      Commission payments

      A vehicle salesperson and their employer can negotiate commission payments.

      Any commission payment arrangements need to be in writing and include the basis on which commission will be paid. The employer has to keep a copy of the agreement, and give a copy to the employee within 21 days of their start date.

      Each month, an employee has to be:

      • told the particulars of the vehicles delivered 
      • told what commission was earned during the month 
      • paid commission or any balance of the commission that is owing. 

      This information has to be provided within 21 days of the last day of the month.

      Changing commission payment arrangements

      The commission arrangement can be changed if:

      • the employer and employee agree to it in writing, or
      • the employer gives 1 weeks notice in writing. 

      When commission payments are due

      Commission accumulates when the vehicle is delivered to the customer.

      When the vehicle sale involves 2 or more salespersons, they have to agree on how the commission will be divided between them.

      If an employee resigns or is dismissed:

      • before the vehicle they sold is delivered, they will get paid 2/3 of the commission if it’s delivered within 3 months of the date their employment ends 
      • after the vehicle is delivered but before the commission is paid, they will get paid the commission within 14 days of date their employment ends.

      For hourly pay rates in this award, check Minimum wages.

      To find out more about who this award applies to, go to the Vehicle Award summary.

      Source reference: Vehicle Manufacturing, Repair, Services and Retail Award 2010 [MA000089] clause 44.9 external-icon.png

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