Glossary

Short definitions of the terms you'll see on Earnest's dashboards, statements and admin screens. Words in bold are the labels the app uses. For the full rules, follow the links to the guides.

Pay and rates

Comp plan

The rules Earnest uses to turn credited sales into commission: the metric, the payout frequency, tiers, kickers, cap, floor and ramp. A plan pays the people on the teams it is assigned to. It does not hold anyone's rate. See Comp plan reference.

OTE (on-target earnings)

What a person earns in a year at exactly 100% of quota: base salary plus variable pay.

Base salary

The fixed part of pay. Earnest uses it to work out variable pay; payouts in Earnest are commission, not salary.

Variable pay

OTE minus base salary. The amount a person earns from commission at 100% of quota over a year.

Commission rate

What a person earns per dollar (or per unit) of credited sales at the standard tier: variable pay ÷ annual quota. OTE $200,000, base $100,000 and quota $1,200,000 give 8.33%. Each person has their own rate. Seasonality, a plan mix or a Sum of Reports title changes it.

Commission Rate mode

An option in Edit Position (Comp Mode) and People Bulk Upload that lets an admin type a percentage instead of OTE. Earnest saves OTE = base salary + rate × quota.

Flat Payout Rate (per unit)

A fixed amount per unit on a Unit Count plan, such as $50 per meeting. When it is set, pay is units × rate, and tiers and kickers are not used.

Base Payout Rate

A plan-wide multiplier on tier commission and flat per-unit pay. 1.0 is standard. It doesn't multiply kickers, draws or the floor.

Commission

Pay earned from credited sales under a comp plan: your metric total, measured against your quota and paid at your rate, with tiers and kickers applied.

Measuring performance

Metric type

What a plan measures. Revenue is the money value of deals. Unit Count is a count, such as meetings booked. Ratio (per FTE) is a manager's sales per head of their team.

Quota

Your sales target. It is set as a yearly figure and divided into periods: ÷ 12 for monthly pay, ÷ 4 for quarterly. Ramp, seasonality and joining partway through a period all change a period's quota.

Title quota

The annual quota set on a title within a team. It applies to everyone on that title who has no quota of their own. A title's Quota Source is either Own Quota (a fixed figure) or Sum of Reports.

Sum of Reports (roll-up quota)

A manager's quota made from their direct reports' quotas, weighted by the days each report was on the team. Shown as "(Σ Reports)". It is 0 while nobody reports to the manager.

Attainment

Progress against quota as a percentage: metric total ÷ the period's quota. 120% means 1.2 times the target.

Tier

A band of attainment with its own multiplier, called Payout Rate in the plan editor and Rate Multiplier in the Simulator. Tiers work like tax brackets: a multiplier only applies to the sales inside its band. A plan with no tiers pays a flat 1× of the rate.

Accelerator

A tier with a multiplier above 1.0, usually above 100% attainment. A 2.0 accelerator pays twice the normal rate on sales in that band.

Kicker (Milestone Bonus)

A bonus set on a tier, as a percentage of the period's variable pay. It is paid in every period that attainment reaches the tier's starting point, not once. With $100,000 variable pay a year, a 5% kicker on a monthly plan pays $416.67 in each month that reaches it. Kickers from several tiers add up.

Commission Cap

The most a person can earn from a plan in one period, bonuses included. It shrinks in proportion when someone works only part of a period.

Commission Floor

The least a person earns from a plan in a period, even with no sales. It shrinks the same way as the cap. It doesn't apply in a period whose total is negative.

Ramp

A reduced quota for a new hire's first months, set per month on the plan. Months count from the start of the person's unbroken employment, not from each new role. By default, ramp months pay a flat 1× rate with no accelerators or kickers.

Draw (Guaranteed Draw)

A guaranteed minimum during a ramp month, as a percentage of that period's variable pay. If commission comes in lower, a draw top-up makes up the difference, and the person keeps it. The cap still applies.

Proration

Scaling a period down for someone who worked only part of it. Their quota, cap, floor and draw shrink in proportion to the days worked. Their rate stays the same.

Prorate Accelerators

A plan setting that also scales accelerator multipliers toward 1.0 in a partial period. A 2.0 tier for someone who worked half the period pays 1.5.

Seasonality

A team's quarterly weights, which must add up to 1.0 (0.25 each by default). A heavier quarter has a bigger quota and a lower rate per dollar, so pay at target stays the same each month. Keep all four at 0.25 for a flat percentage of revenue.

FTE (full-time equivalent)

The headcount used by Ratio plans: everyone reporting into a manager, weighted by the days each was active. An admin can set an FTE override for a manager for a month that hasn't been published.

Plans and teams

Payout frequency

How often a plan pays: Monthly, or Quarterly (one payout per quarter, in its last month).

Evaluation period / QTD

How attainment is measured on a Monthly plan. Quarterly (QTD) measures the quarter so far each month, applies the tiers, and pays the difference from what was already paid that quarter (a true-up). One big month can't earn its accelerator twice.

Plan mix

A team setting that splits variable pay across several plans by weight, for example 70% new business and 30% renewals. One plan is the default and receives deals not tagged to a plan. Statements show a Plan Breakdown.

Roll-up manager

A manager whose quota is Sum of Reports. They are credited with every deal their reporting tree closes while those people report to them. When a rep joins or leaves the team, only that rep's share of the quota is prorated. The manager's own variable pay is not.

Credit split

Sharing one deal's credit between several people. The shares can add up to more or less than 100%, but no one person can get more than 100%.

Mid-period change

A position change that starts partway through a pay period. A move to a different plan splits the period by close date: each deal is paid under the plan in force the day it closed. A raise, quota or team change on the same plan is blended by days. Some moves must start on a period's first day. See Comp plan reference.

Payouts and corrections

Earnings

Everything earned for a period: commission plus bonuses, draw and floor top-ups, and adjustments.

Payout

The record of one person's earnings for one period. It is drafted, reviewed and published. See Payout pipeline reference.

Draft and published

A draft payout is a preview. It changes when it is regenerated and shows "Draft — subject to change". A published payout is final and frozen. Fixes to it arrive as corrections in a later period.

Out of date

A badge on a draft whose inputs (deals, positions, plan settings) changed after it was drafted. Regenerate it before you publish.

Publish hold

A block on publishing a draft because something it was calculated from changed after it was generated. Regenerating clears it.

Anomaly check

A scan before publishing that flags unusual payouts: "$0 with activity", "3× above average", "±50% vs last period" and "clawback carried forward". You acknowledge the flags to publish.

Draft sign-off

A manager marking a report's draft as reviewed (Mark reviewed). It is for information only and never blocks publishing. Regenerating the draft clears it.

Statement

The published summary of a payout, in the app and as a PDF.

Acknowledgement

A rep confirming they've seen a published statement (Acknowledge statement). It doesn't give up the right to dispute.

Adjustment

A manual amount added to a draft. A Revenue Adjustment or Volume Adjustment joins the metric total and goes through the commission math. A Fixed Bonus is added at the end. Adjustments a manager submits need an admin's approval and expire after 14 days if nobody reviews them.

Correction

A fix to a published payout, posted to a later open period. There are four kinds: True-up, Clawback, Amendment and Dispute. See Corrections and clawbacks.

Recompute correction

A correction that re-runs a paid period with corrected revenue, using that period's frozen plan, and posts the difference to the first open month. It isn't available for plan-mix payouts, ramp months paid at a flat rate, or QTD quarters that spanned two plan versions.

True-up

A correction that pays someone more. Also the monthly catch-up payment in QTD evaluation.

Clawback

A correction that takes money back. Negative sales in a period are priced at 1×, never at an accelerator. A payout is never below zero. Any amount left over becomes a recoverable balance.

Recoverable balance

An overpayment carried forward. It is deducted from future positive earnings until paid off. Nobody is asked to pay cash back. See Corrections and clawbacks.

Amendment

A manual correction an admin posts against a published period. It lands in the person's next open period and names the period it corrects.

Dispute

A rep's formal "this payout is wrong", filed from a published statement within the dispute window (60 days by default; an admin can change it). Available only when Disputes is turned on.

Changes over time

Effective date

The date a change starts to apply. A change effective April 1 affects April's pay and leaves March alone.

Closed period

A period with a published payout. Its settings can't change.

Version

One dated set of settings for a plan, team, title quota, plan mix or position. For any date there is exactly one version in force.

In place

Changing the current version directly. Earnest does this when no closed period would be affected, for example on a plan nobody has been paid on yet.

Scheduled change

A new version that starts in a later period, created when a change would otherwise touch a closed period. Listed under Organization → Scheduled Changes.

Cancel (retract)

Removing a scheduled change before it starts. The previous version stays in force. A change that has started can't be cancelled.

Structural field

A plan setting that can't change once pay on the plan is published: Payout Frequency, Metric Type, Evaluation Period and Flat Payout Rate. Duplicate the plan instead.

Plan snapshot

The copy of the plan's rules stored on a payout when it is drafted and frozen when it is published. It is why editing a plan never changes a paid period.

Paid · frozen

The label on a plan version that published pay was calculated from.

As-of audit

An admin tool on the Scheduled Changes page that shows which version governed a past date, and who recorded it when. It shows the version's history, not its quota or tiers. See Scheduled changes and history.

Archive (plan)

Hiding a plan from the default list. Teams still assigned to it keep being paid on it.

Currencies

Base currency

Your organization's reporting currency, used for totals, analytics and the Simulator.

Quota currency

The currency a person's quota and sales are measured in.

Payout currency

The currency a person is paid in. See Multi-currency.