Most companies have their own guidelines for such matters. If you do not have an agreement with your employee in this regard and it is not covered in your employee manual, then you should use your best judgment to be fair.
What you determine should be based on the normal sales cycle. How long does it take to close a sale, as a general rule? Being fair may mean paying out the entire commission if the sale is closed within 30 days and 50 percent if the sale takes 60 days to close.
It may mean paying a percentage if the sales closes within 30 days and no commission if it takes more than 30 days. What you want to do is set a precedent with which you can live for the long-term and avoid making the ex-employee feel exploited enough to file a claim with the Department of Labor for non-payment of wages. While such a claim may not prevail, it can be time-consuming to take on that kind of dispute.
You need to pay them with a paycheck if they were an employee.
Penny is a seasoned human resources executive and consultant with over 25 years of diverse business experience in advising enterprise leaders on employment-related matters.