1) A fee or remuneration paid in return for services rendered. Commission is often calculated as a percentage of the total transaction; commission can be separate and in addition to fixed wages, or it can be the sole form of compensation, known as straight commission.
It is a useful method for resolving the principal-agent problem by incentivizing employees to expend maximum effort on behalf of their employer. However, commission-based transactions may also create conflicts of interest, with unethical agents encouraging clients to enter into unnecessary or fraudulent transactions.
Definition from Nolo’s Plain-English Law Dictionary
1) A fee paid to an agent or employee for performing a specific service, as distinguished from regular payments of wages or salary. 2) A group appointed by law to conduct government business, especially regulation. Examples include a local planning or zoning commission, the Securities and Exchange Commission (SEC), and the Federal Trade Commission (FTC).
Definition provided by Nolo’s Plain-English Law Dictionary.
August 19, 2010, 5:12 pm