Tennessee sales representative employment contract template

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How Tennessee sales representative employment contract Differ from Other States

  1. Tennessee law mandates timely payment of commissions to terminated sales representatives, with specific statutory protections not found in every state.

  2. The Tennessee Sales Representative Act allows for recovery of attorney’s fees and exemplary damages if a principal fails to pay commissions as required.

  3. Tennessee requires written contracts detailing commission terms, whereas some states permit oral agreements or have less specific requirements.

Frequently Asked Questions (FAQ)

  • Q: Is a written contract required for sales representatives in Tennessee?

    A: Yes, Tennessee law requires a written contract specifying commission terms between principals and sales representatives.

  • Q: What can a Tennessee sales representative do if commissions aren't paid on time?

    A: They may pursue legal action for unpaid commissions, attorney’s fees, and possibly exemplary damages under state law.

  • Q: Are sales representatives entitled to commissions after contract termination in Tennessee?

    A: Yes, they are entitled to commissions earned before termination, as specified in the written contract and by Tennessee statutes.

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Tennessee Sales Representative Employment Contract

This Full-Time Sales Representative Employment Contract (the “Agreement”) is made and entered into as of [Date], by and between [Employer Legal Name], a [State of Incorporation] corporation with its principal place of business at [Employer Address] (“Employer”), and [Employee Legal Name], residing at [Employee Address] (“Employee”).

1. Position and Duties

  • Option A: Position: Sales Representative.
  • Option B: Position: Senior Sales Representative.

Employee shall perform the following duties:

  • Business development and lead generation.
  • Customer prospecting and qualification.
  • In-person and virtual client meetings and product demonstrations.
  • Creation and management of sales presentations.
  • Contract negotiation within authorized limits.
  • Pipeline management via [CRM Platform Name].
  • Consistent sales reporting.
  • Participation in trade shows and events.
  • Compliance with company pricing and discount policies.
  • Adherence to sales targets and quotas.
  • Prompt submission of sales documentation and expenses.

2. Products/Services, Industry Knowledge, and Target Market

  • The Employee will sell the following products/services: [List of Products/Services].
  • The Employee is required to have industry knowledge in the following areas: [List of Required Industry Knowledge].
  • The Employee will target the following market segments: [List of Target Market Segments].

3. Territory

  • Option A: The Employee’s territory shall be: [List of Tennessee Counties/Cities/Regions].
  • Option B: The Employee’s territory shall be: [List of Tennessee and Other State Counties/Cities/Regions].
    • Local travel within [Territory] is required.
    • Option A: Employee will use a company vehicle for sales activities.
    • Option B: Employee will be reimbursed for mileage at the rate of [Dollar Amount] per mile, in accordance with company policy.

4. Reporting Structure and Collaboration

  • The Employee will report directly to [Supervisor Name/Title].
  • Option A: The Employee will also work with the Regional Manager, [Regional Manager Name].
  • The Employee is expected to collaborate with the [List of Departments/Teams] departments.

5. Work Location and Telecommuting

  • Option A: The Employee’s primary work location will be the Employer's office at [Employer Address].
  • Option B: The Employee’s primary work location will be the Employee's home office.
  • Option C: This position requires significant field presence at client locations.
    • Option A: Telecommuting is permitted according to the company’s telecommuting policy.
    • Option B: Telecommuting is not permitted for this position.
    • The Employer will provide the following technology/mobile devices: [List of Equipment].
    • The Employee is responsible for maintaining data security and privacy on all devices per the company's and Tennessee’s data protection standards.

6. Hours of Work

  • This is a full-time position.
  • The standard work hours are [Number] hours per week, from [Start Time] to [End Time], Monday through Friday.
  • The Employee is entitled to a [Number] minute unpaid meal break and [Number] minute paid rest breaks as required by Tennessee law.
  • The Employee must accurately record their time and client visits using [Timekeeping Method].

7. Compensation

  • Option A: The Employee’s annual salary will be [Dollar Amount], paid [Pay Frequency].
  • Option B: The Employee’s hourly rate will be [Dollar Amount], paid [Pay Frequency].
  • Commission/Incentive Structure:
    • The commission rate/formula is: [Commission Rate/Formula].
    • Commission is paid on: [Sales Metrics].
    • Commission payouts occur: [Payout Timing].
    • Clawback/chargeback procedures for cancellations/refunds are as follows: [Clawback Procedures].
    • Thresholds for accelerators are: [Accelerator Thresholds].
    • Option A: The Employee will receive a draw of [Dollar Amount] per [Pay Period], which will be accounted for against earned commissions.
    • Option B: The Employee will not receive a draw.
    • Option A: The Employee is guaranteed minimum earnings of [Dollar Amount] during the first [Number] months of employment.
    • Option B: The Employee is not guaranteed minimum earnings.
    • Overtime will be paid according to Tennessee and FLSA standards.
    • Pay will be delivered via: [Direct Deposit/Check].
    • Expense reimbursements will be paid according to company policy, with receipts required for all expenses. Per diem rates are [Dollar Amount].

8. Benefits

  • The Employee is eligible for the following benefits, subject to the terms and conditions of the applicable benefit plans:
    • Medical, dental, and vision insurance (eligibility after [Number] days).
    • 401(k) or comparable retirement plan.
    • Paid vacation and sick leave (accrual rates: [Accrual Rates], carryover/forfeiture rules: [Carryover Rules]).
    • Company-observed holidays.
    • Option A: Professional development and sales training allowance of [Dollar Amount] per year.
    • Option B: No professional development allowance provided.
    • Option A: Company car is provided.
    • Option B: Auto allowance of [Dollar Amount] per month.
    • Option A: Mobile phone reimbursement of [Dollar Amount] per month.
    • Option B: No mobile phone reimbursement provided.
    • Eligibility for bonuses, prizes, or sales contests under company policies.
    • The Employer reserves the right to modify benefit plans at its discretion, as permitted by Tennessee law.

9. Intellectual Property and Sales Assets

  • All sales materials, client lists, CRM data, proposals, marketing collateral, and confidential product information developed or accessed during employment are the property of the Employer.
  • Upon termination of employment, the Employee must return or delete all company property.

10. Confidentiality

  • The Employee agrees to hold confidential all client information, pricing, product roadmaps, trade secrets, and proprietary Employer data.
  • Disclosure to third parties is prohibited without prior written consent from the Employer, except as required by law.
  • These confidentiality obligations survive termination of employment.

11. Outside Business Activity

  • The Employee must provide notice and obtain approval from the Employer before engaging in any secondary employment or external sales activities.
  • The Employee is prohibited from soliciting Employer clients for personal gain.
  • The Employee is prohibited from using company sales contacts for non-Employer benefit.

12. Post-Employment Restrictions

  • Option A: Non-Solicitation: During employment and for a period of [Number] months following termination, the Employee shall not solicit any client or employee of the Employer.
  • Option B: Non-Disclosure: During employment and indefinitely following termination, the Employee shall not disclose confidential information of the Employer.
  • Option C: Non-Compete (Consult with legal counsel to ensure enforceability under Tennessee law): For a period of [Number] months following termination, within a geographic area of [List of Counties/Cities], the Employee shall not engage in any business activity that is competitive with the Employer's business regarding [Specific Competitor/Product/Service]. In consideration for this non-compete agreement, the employee will receive [Consideration].

13. Professional Conduct and Compliance

  • The Employee shall maintain professional conduct with clients and colleagues.
  • The Employee shall comply with all anti-bribery rules, supplier policies, and lawful marketing practices under Tennessee and federal law.
  • The Employee shall observe company social media and electronic communication etiquette.

14. Harassment and Discrimination

  • The Employee shall report any incidents of client harassment, discrimination, or ethical violations.
  • The Employer maintains anti-discrimination policies covering all protected classes under the Tennessee Human Rights Act.

15. Employment At-Will

The employment relationship is at-will, meaning that either the Employee or the Employer may terminate the employment at any time, with or without cause, subject to any contractual obligations stated elsewhere in this agreement.

16. Termination

  • The Employee may resign with [Number] days’ written notice.
  • The Employer may terminate the Employee with or without cause.
  • Option A: If the employee is terminated without cause, the employee will be entitled to severance pay of [Number] weeks’ salary.
  • Option B: No severance pay will be provided.
  • Final wage payment will be made within the time period required by Tennessee wage statutes.
  • Upon termination, the Employee must return all company property.
  • Active sales opportunities will be transitioned as directed by the Employer.
  • Outstanding expense claims or commissions will be settled according to company policy, including pro-rata calculations for partially completed sales at termination.

17. Compliance with Laws

  • The Employee shall comply with all Tennessee and federal employment laws, including FLSA, Workers’ Compensation, wage statement requirements, and OSHA standards.
  • The Employee shall obtain any required licenses or registrations for selling regulated products/services.

18. Dispute Resolution

  • Any disputes shall be escalated according to the company’s dispute resolution policy.
  • Notice of any claim must be given to the other party within [Number] days of the event giving rise to the claim.
  • This Agreement shall be governed by the laws of the State of Tennessee. Venue for any legal action shall be in the courts of [County Name] County, Tennessee.
  • Option A: Any dispute arising out of or relating to this Agreement shall be settled by mandatory mediation in [City Name], Tennessee.
  • Option B: Any dispute arising out of or relating to this Agreement shall be settled by binding arbitration in accordance with the rules of the American Arbitration Association in [City Name], Tennessee.
  • The Employer retains the right to seek injunctive relief for breaches of post-employment restrictions.

19. Acknowledgment of Policies

The Employee acknowledges receipt of the company’s Employee Handbook, Code of Conduct, Anti-Harassment Policy, Data Privacy Policy, and Sales/Marketing Regulations.

20. Severability

If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect.

21. Tax Withholding and Reporting

  • All compensation paid to the Employee will be subject to applicable Tennessee and federal tax withholding.
  • The Employer will comply with all applicable state reporting obligations.
  • The Employee acknowledges that the Employer may conduct background checks and/or E-Verify checks as required by law.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

[Employer Legal Name]

By: [Employer Representative Name]

Title: [Employer Representative Title]

[Employee Legal Name]

[Employee Signature]

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