Comp plan reference

Who this is for: admins who design or troubleshoot comp plans. If you haven't built a plan yet, read Create your first comp plan first.

This page covers every plan setting, how it changes pay, and the rules that protect published pay. Only admins can edit plans, and not while the organization is in demo mode or billing is locked.

Plan settings at a glance

The Create Compensation Plan wizard (Organization → Plans → Create New Plan) has five steps. After creation, the same fields live in Configure rules on the plan page, on the General, Commission Schedule and Ramp Schedule tabs.

Metric types

Revenue

Pays on the money value of credited deals, in the rep's quota currency. Attainment is revenue ÷ the period's quota.

Unit Count

Pays on a count, such as meetings booked. Unit Label is required ("A unit label is required"). There are two ways to pay:

• With a Flat Payout Rate (per unit): pay is units × rate × Base Payout Rate. Quota and OTE are not used for pay, and the plan has no commission schedule. The Schedule step and the Commission Schedule tab say "This plan pays a flat rate per unit, so it has no commission schedule. Tiers and kickers aren't used or saved. Clear the Flat Payout Rate to use tiers.", and Review shows the schedule as "None (flat rate per unit)". Switching a plan that has tiers to a flat rate asks "Delete this plan's tiers?" before it saves. Cap, floor and plan-mix weight still apply.
• Without one: units go through the normal rate and tiers, where the rate per unit is (OTE − base) ÷ annual unit quota. OTE $70,000, base $50,000 and a quota of 480 meetings a year gives $41.67 per meeting.

Ratio (per FTE)

For managers. It measures a currency numerator (for example sales) per head of the manager's team against a per-head Goal:

Attainment = total numerator ÷ (Goal × total FTE)

FTE (full-time equivalent) is the headcount of everyone reporting into the manager, nested, weighted by the days each person was active. A ratio plan only pays a manager or Sum of Reports position. Only the team's manager earns from it, and the engine refuses to price one for an individual rep. Ratio plans can't join a plan mix, and the Simulator doesn't list them.

If the derived headcount is wrong for a month, open the ratio plan's page and use FTE Denominator Overrides → Add override, or Set ratio FTE override in the manager's row menu on People. An override belongs to the manager, not the plan, and can't be changed for a published month.

How a rep's rate is set

A plan has no commission % field. Each person's rate is derived from their position:

Rate = (OTE − base salary) ÷ annual quota

OTE $200,000, base $100,000 and quota $1,200,000 give 8.33%. You can set it three ways:

• Enter OTE and Base Salary in Invite User or Edit Position.
• In Edit Position, switch Comp Mode to Commission Rate and enter Rate (%). Earnest saves OTE = base + rate × quota. OTE is what is stored, so if the quota changes later, the percentage changes with it.
• On People Bulk Upload, choose Commission Rate Mode. The rate is a decimal there: 0.08 means 8%.

Details that change the number:

• The rate uses the full annual quota. A rep who starts mid-month gets a smaller target and less pay for that month, but the same rate.
• Seasonality changes the rate (see Seasonality). The "commission rate" preview in Edit Position ignores seasonality.
• On a plan mix, each plan's rate is its weight × (OTE − base) ÷ that plan's quota.
• For a Sum of Reports manager, the quota is the team's quota (see Managers and roll-up pay).

What pays $0. OTE empty or not above base; no quota; Base Payout Rate 0; Commission Cap 0; a first tier above 0% (revenue below it earns nothing). When you draft payouts, Earnest names anyone with no rate in a "no commission rate" warning, and their row on the Payouts page shows No rate. On People, their Status shows No rate too; hover it for the reason. (Tier kickers, a floor or a draw can still pay a rep with no rate.) Before you publish, Earnest flags a rep with sales and a $0 payout as "$0 with activity".

A rep whose team has no plan is not paid $0: they are paid a flat 1× of their rate, with no tiers, cap or floor, and drafting warns "no commission plan assigned".

Quotas

Position and title quotas

For a team with one plan, a person's annual quota is the first of:

1. The quota on their position (Edit Position → Quota).
2. Their title's Annual Quota, set on the team's titles.
3. Nothing: no quota, and no variable pay.

Edit Position refuses OTE above base with no quota: "OTE above base salary is variable pay, and variable pay needs a quota to measure attainment against."

Own Quota and Sum of Reports

Each title has a Quota Source. Own Quota uses the title's fixed annual quota. Sum of Reports (shown as "(Σ Reports)" in pickers) makes the quota the total of the person's direct reports' quotas, worked out by day. A quota typed on a Sum of Reports position is never used, and with no reports the quota is 0. On People, their Quota reads Sum of Reports.

Tiers and accelerators

Each row of the Commission Schedule has From %, To %, Payout Rate (a multiplier from 0 to 100) and Milestone Bonus (Kicker). Rules:

• Tiers are marginal, like tax brackets. A multiplier applies only to the revenue inside its range.
• Attainment is measured against the period's quota, so tiers restart every period.
• The last tier must be open-ended: "The final tier must be open-ended — leave "To %" empty (∞)."
• A plan with no tiers pays a flat 1× of the rate.
• Revenue below a first tier that starts above 0% earns nothing.
• Negative revenue in a period (a clawback) is always priced at 1×, never at an accelerator.

Example. Rate 8.33%, monthly quota $100,000, tiers 0–100% at 1.0, 100–120% at 1.5, 120%+ at 2.0. The rep closes $130,000:

Base Payout Rate

Multiplies tier commission and flat-rate unit pay. 0.8 cuts that pay by 20%. It does not multiply kickers, draws or the floor. In a ramp month where the commission schedule is disabled, it is treated as 1.0.

Kickers

A Milestone Bonus (Kicker) pays a percentage of the rep's variable pay for that period when attainment reaches the tier's From %:

Kicker = bonus % × (OTE − base) ÷ 12 on a monthly plan, or ÷ 4 on a quarterly plan

• It is paid in every period the threshold is reached. It is not a one-time bonus.
• Kickers add up: reach two thresholds and both pay.
• It is day-prorated for a partial period, scaled by plan-mix weight, and capped at 200%.
• Flat-rate unit plans and ramp months with the schedule disabled pay no kickers.
• With Quarterly (QTD) evaluation, it is measured on the quarter so far, and amounts already paid that quarter are deducted.

Example. Variable pay $100,000 a year; kickers of 5% at 100% and 10% at 150%. A month at 160% pays 5% × $8,333.33 + 10% × $8,333.33 = $1,250 in kickers that month. On a quarterly plan the same quarter pays 5% × $25,000 + 10% × $25,000 = $3,750.

Adding a 5% kicker at 100% to the tier example above adds $416.67, for a total of $12,916.67.

Caps, floors and draws

• Commission Cap is the most a rep earns in a period, bonuses included. Commission Floor is the least.
• Both are applied after kickers, to the total.
• Both are day-prorated when a rep works part of a period, and scaled by the plan's weight on a plan mix.
• The floor applies every period, even with no sales, but not in a period whose total is negative.
• With QTD evaluation, cap and floor build up month by month across the quarter.
• Guaranteed Draw (% of Variable) is set per ramp month. It tops pay up to that percentage of that month's variable pay, prorated by days. On a quarterly plan, the quarter is topped up to the total of its ramp months' draws. The rep keeps the top-up. The cap still limits it.

The order is: tier commission + kickers → cap → floor → draw top-up → cap again → quarter-to-date deduction.

Payout frequency and evaluation period

Payout Frequency sets the period. Annual figures are divided by 12 for Monthly and by 4 for Quarterly. A Quarterly plan makes one payout per quarter, drafted when you open the quarter's last month on Payouts.

Evaluation Period appears only on Monthly plans:

• Same as Payout Frequency: each month stands alone.
• Quarterly (QTD): paid monthly, measured on the quarter so far. Each month Earnest totals the quarter's revenue and quota, applies the tiers, and pays the difference from what it has already paid. A big deal in month 1 doesn't earn its accelerator again in months 2 and 3. Each earlier month of the quarter must be published before the next one can be.

QTD plans can't join a plan mix.

Seasonality

Each team has Seasonality (quarterly weights, must sum to 1.0), 0.25 per quarter by default. A quarter's quota is the even quota × 4 × its weight.

Seasonality also changes the rate, so on-target pay per month stays the same. With a $1,200,000 quota and a 10% rate:

Reaching each monthly quota pays $10,000 in every case. For a flat percentage of revenue, keep all four weights at 0.25. Moving a rep to a team with other weights changes their quota and rate.

Ramp schedules

A ramp gives new hires a reduced quota. Rows read Month 1, Month 2 and so on, each with Quota % (for example 50) and Guaranteed Draw (% of Variable) (0 to 100). Tenure counts from the start of the person's unbroken run of positions, so a promotion or a raise doesn't restart it. The ramp lowers the target, not the rate.

One switch covers the whole plan: Disable Commission Schedule during ramp. It is on by default. While it is on, ramp months pay a flat 1× of the rate with no accelerators and no kickers, and Base Payout Rate counts as 1.0. These months can't be recomputed exactly later; post an adjustment for any difference instead. Turn it off to apply the schedule against the reduced quota.

On the plan page, ramp changes save with their own Save Ramp Schedule button.

Prorate Accelerators

Can only be switched on while Disable Commission Schedule during ramp is off. Then, in any period a rep works only part of (ramp or not), multipliers above 1.0 move toward 1.0. A 2.0 tier for a rep who worked half the period pays 1.5. Kickers are day-prorated with or without this setting.

Team plan mix

A team can split variable pay across several plans: Edit Team → Comp Plan → Plan mix → Set up plan mix.

• Each row has a plan, Weight %, an optional Team default annual quota (opt.) and a Default choice.
• Refusals: "Plan weights must sum to 100%.", "Exactly one plan must be the default (it catches untagged orders).", "The default plan must carry a non-zero weight — it catches all untagged orders." and "Each plan can appear only once in a mix."
• Quarterly-frequency, QTD and ratio plans can't join.
• Deals go to a plan by their plan name (on import, or picked on a manual entry). Untagged deals go to the default plan.

Each member's quota for each plan is the first of: their own target (Edit Position → Plan targets), the team default for that plan, then their position or title quota. A mix that spans metric types, or has two plans of the same metric, needs a per-plan quota for every member or a team default. Otherwise the save is refused ("A mix spanning metric types needs a quota per plan.").

Statements show a Plan Breakdown. A mixed payout can't be recomputed automatically; post an adjustment instead.

Managers and roll-up pay

Managers, and anyone on a Sum of Reports title, are credited with deals closed by anyone in their reporting tree on the days they managed that person.

A Sum of Reports manager's annual quota is each report's full annual quota × the days that report was under her, added up and divided by her own days in the role. Nested managers contribute their own roll-up, and reports' ramps lower it. Her rate is (OTE − base) ÷ that team quota, so reaching 100% pays her full variable pay for her days.

A rep's move prorates the rep's quota, never the manager's variable. Example: manager variable $50,000 a year; rep A (quota $1,200,000) all of a 30-day month; rep B (quota $1,200,000) joins on day 16. Her quota is ($1,200,000 × 30 + $1,200,000 × 15) ÷ 30 = $1,800,000 a year, so $150,000 for the month and a rate of 2.78%. Team sales of $150,000 pay her $4,166.67, her full month.

A near-empty team gives a very high rate; only the plan's cap limits it.

Mid-period moves

Edit Position takes an effective date, so a change can start mid-period.

• Same plan (a raise, new quota, new title, team or manager move): one period, with OTE, quota and rate blended by days.
• Different plan: the period splits by close date. Each deal is paid under the plan the rep was on the day it closed, against that plan's quota prorated to its days. Caps, floors and draws apply per plan, prorated. Revenue adjustments for the period count toward the plan of the position covering the most days (the newer one if tied).

The preview names the split ("March will be split: …") or the next date that works. These moves can't be split and must start on a period's first day: onto or off a plan mix, a QTD or ratio plan, a change of pay frequency, a manager's position, a period with no plan on one side, and a title becoming Sum of Reports.

Editing a plan: versions

• Until any member's payout on the plan is published, edits apply in place to every period. The button reads "Save — applies now", with "Applies to all periods — none are closed yet." Drafts priced on the old rules are flagged ("still reflect the old rules", with Review drafts). Regenerate them.
• After a publish, saving starts a new version from the next open period by default ("Save — starts in" a period). Closed periods keep their settings. Forward changes appear on Organization → Scheduled Changes, where you can cancel them.
• Payout Frequency, Metric Type, Evaluation Period and Flat Payout Rate can't change once pay is published ("This can't change once pay is finalized"). Use Duplicate this plan.

The plan page's Version History marks paid versions "Paid · frozen". See Scheduled changes and history.

Plan lifecycle

• Rename plan (pencil icon): always allowed.
• Duplicate: copies the plan, unassigned and unpaid.
• Archive: hides the plan from the default list. Teams still assigned keep paying on it. Unassign them to stop pay.
• Delete: refused when the plan has published payouts ("Archive it instead."), tagged sales entries, a place in a plan mix, or team assignments. If drafts exist, type the plan's name to confirm.

Published-period locks

Pick a later month, or fix the paid period with a correction (Corrections and clawbacks).

FAQ

Can titles on one team have different plans? No. Put them on separate teams, or use a plan mix.

Edit Position shows 10%, but the statement paid less per dollar. Check seasonality, a plan mix or a Sum of Reports title. All three change the rate.

Can a ramping rep earn accelerators? Only if Disable Commission Schedule during ramp is off.

Can I schedule a rule change on a plan that has never paid? Not from the editor; the edit applies now. Duplicate the plan, change the copy, and switch the team to it with Effective from.

Does archiving stop pay? No.

Can the floor be higher than the cap? No: "Cap must be greater than or equal to Floor."

Can I model a change first? Yes: Modeling and optimizing plans.