Non-Recoverable Draw

A non-recoverable draw is a payment given to sales reps that the employer cannot or does not recover. Think of it as a guaranteed minimum commission payment.

If the total commission the employee earns that month is less than the draw amount, they are paid the difference. If the commission they earn that month is higher than the draw minimum, they receive it all but no draw.

For example, if the non-recoverable draw minimum for employee Ying is set at $2000, and the commission Ying earns that month is only $1,000, they will still be paid $2,000.

If Ying makes $3,000 in commission next month, they will be paid the full $3,000 in commission but nothing from the draw.

Click here to learn more about recoverable and non-recoverable draws.