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Controlled Copy
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Sales Incentive Policy

Employee Name Designation Signature

Approved By Arati Naik Chief Operating Officer

Authorized by K.R. Naik Executive Chairman

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Table of contents

Particulars Page no.

Objective 3

Scope 3

Premise 3

Targets 3

Incentive for target achievements 3

Process 4

Incentive Payment 4

Guidelines 6

General 6

Related documents / Incentive Calculation

7
Basis

Incentive claim form 8

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1) Objective
To encourage work culture linked to productivity, conducive to the needs of business thereby
motivating and encouraging superior performance.

2) Scope
Applicable to Sales employees with a PLP/SI component in their salary structure.

3) Premise
The policy is based on targets set for Individual employee. Targets are essentially the
qualitative and quantitative guidelines for implementing the business strategy.

4) Targets
Regional and Individual targets are planned for sales and sales related functions to meet
Budgeted targets. Each employee shall have targets, linked to his/her regional planned
targets cascading downwards. The targets setting shall have confirmation of the COO and
information shall be given to HR.

5) Incentive for Targets Achievement

Incentive earnings are linked to the targets achieved. Individuals will qualify and start
earning incentives when a minimum of 80% of the target is achieved. Individuals also have
the potential opportunity to earn more by achieving over and above the targets allocated.

Incentive Calculation Basis for employees has been mentioned below in Annexure 10.1.

The Accelerator shall be applicable when an individual achieves over 96% of his target. The
Accelerator entitles an individual to earn an incremental amount i.e. the PLP component of the
salary structure, from 105% to 150% of the targets.

Timely Collection of “C” forms and receivables from Customers shall also be an important
ingredient for calculating incentives.

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6) Process
The process of Goal setting initiates with the release of the financial objectives of the Company
and the Business Units for an FY. The responsibility for completion of target setting and review
lies with the Respective Regional Sales Head/Departmental Heads along with the COO. COO
shall be the final authority for setting targets for the entire Sales force. The details shall be sent to
Corporate HR. The individual targets shall be recorded in the Goal Sheet. Incentive would not be
paid if the targets have not been approved by the Sales Head/CFO and the same being conveyed
to H.R.

 In order to make the sales incentive policy more meaningful and contributory to the
success of company as well as the individual performance, it is necessary that individual
objectives of all employees be finalized with a concept of downward cascading of targets.
 Progress update should take place between the incumbent and the supervisor
throughout the year through formal and informal discussions. This process could help
assessment of the actual achievements and make changes, if required, in the action plans
to achieve and/or improve annual objectives. The frequency of such assessment shall be
revised based on the objective targets and required monitoring for the same in
consultation with COO and involvement of HR for effective monitoring of the same.

Actual achievements after due review and approval by the reporting Supervisor shall be
submitted to the HR team in the Performance Linked Claim Form (Annexure 10.2). The approved
incentives shall be paid along with the salary process only.

No claim would be processed, unless approved by the Reporting Manager.

7) Incentive Payment
 The Incentive payout shall be made at the end of the quarter provided the employee is on
rolls of the company as on the date of disbursement.
 The employee shall qualify for the incentive payment on achievement of 80% of the
target assigned.

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 Incentive cannot be clubbed for 2 quarters. It has to be claimed separately for individual
quarters. In case a sales employee cannot claim for a particular quarter, the claim for the
same can be done at the end of the year, subject to him achieving 80% for the total annual
target. E.g. Mr X is eligible for Q1 & Q2; He can claim incentive, separately for both the
quarters. Going forward, if he is not eligible for Q3 & Q4, he cannot claim incentive for
the same. However at the end of the year, on the overall target if Mr. X achieves 80%, he
can claim for the entire year minus the payouts made for Q1 & Q2.
 The maximum incentive an employee can receive is capped at 150%. If Mr. X achieves
200% of his allocated target, he would still be eligible for claiming an incentive of 150%.
 “C” form collection for respective sales on which incentive is paid is also the
responsibility of the respective sales person claiming incentive. “C” forms should be
collected quarterly by the responsible sales individuals. The last date for submission of
all pending “C” forms is the end of quarter preceding the earlier quarter. For. E.g: Mr. X
is claiming incentive for Q4 ’15-16, in such a case all his “C” forms till Q3 ’15-16 should
be submitted. Achieved Sales to the extent of the value of “C” forms not received, shall
be deducted from sales achieved for calculating incentives. The incentives withheld for
non receipt of “C” forms will be released along with the next quarterly incentive
payment only on receipt of “C” forms. The withheld incentive shall lapse if “C” forms
not collected on or before 9 months from the end of the previous financial year.
 Any exceptions to be considered towards non-collection of “C” Forms would require
approval from COO.
 Post deductions, if the % achieved is less than 80%, the sales employee would still be
eligible for Incentive. However Payouts would be made, on the Basis of % Achieved,
after deductions.
 All claims should be submitted to the Business Finance team with complete supporting
documents, on or before 15th of the month in which the incentive needs to be paid along
with the Salary for the month. Any claim, received after 15th of the month, would be
processed in the next payroll process.

8) Guidelines
 The basis of calculating target achievement would be based on the actual billing done for
the respective quarter.

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 Employees on probation shall be eligible for participation in the scheme. New Joiners
shall qualify to participate in the scheme, provided the targets are set for them and
communicated to the Corporate HR department.
 In case an employee receives an increment in his/her salary structure in between the FY,
affecting the PLP component, the Sales Incentive shall be calculated on the basis of the
same.
 In case an individual gets transferred from one region to another, the targets need to be
reset accordingly. The same process shall be observed as explained under point 8.
 Individuals claiming for their incentives, who are retiring/resigning from the services of
the Company, would be paid as per the incentive policy mentioned above, considering
his/her LWD as their end date for calculation purpose. The separating employee shall
submit the duly approved form to Business Finance with all appropriate Supporting. The
same would be however, paid along with the Full & Final settlement of the employee.
 Any deviations/exceptions from the policy shall be done only with the approval of COO.

9) General
This policy outlines the spirit behind the Company’s approach in giving fair and
consistent treatment to all employees. Therefore, employees are expected to respect the
rules and the standard operating procedures governing this policy. Where
circumstances are unusual or situations not anticipated or defined in this policy, such
matters should be referred to the Management for resolution in a manner that is
consistent with the whole aim and sprit of this policy. Such decisions shall be final and
binding.
This policy supersedes all other policies, procedures and practices prevalent on this
subject to date. Company reserves the right to add to, alter or amend, or cancel this
policy at its discretion if needed in future.

10) Related Documents

 PLP/SI Claim Form.
 Supporting, towards the sales figure.

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Annexure 10.1

Incentive Calculation Basis for Sales Employees

Target Achievement Incentive Earnings – Sales Employees

0% - 79% 0

80% - 89% 65%

90% - 95% 80%

96% - 99% 105%

100% - 110% 130%

111% & Above 150%

Incentive Calculation Basis for Regional Sales Manager

Target Achievement Incentive Earnings – Regional Sales Manager

0% - 79% 0

80% - 89% 40%

90% - 95% 70%

96% - 99% 110%

100% - 110% 135%

111% & Above 150%

Note:
As a thumb rule, decimal achievement of 0.5% and above will be considered close to the next full
number and below 0.5% will be equivalent of the lower full number, (99.44% is strictly 99% only).

No representation to be made for any soft consideration of such matters.

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Annexure 10.2

PERFORMANCE INCENTIVE CLAIM FORM

Emp. Code: _____________________ Quarter: (Q1 / Q2 / Q3 / Q4) / Full Year

Emp. Name: ___________________________ Date of Joining: ________________

Annual Target: _________________________ Target for the Quarter: ___________

Annual Incentive Eligibility Amt (Based on DOJ): _______________________________

Proportionate
Incentive for
Achievement Eligible
Value of "C" % of
Achievement to be amt of
Target % of forms / incentive
for the considered incentive
for the achievement Debtors not to be
Quarter for for the
Quarter collected to paid
incentives quarter
be kept on
hold

Note: Eligibility for Incentive: 80% achievement of the target for the quarter

Prepared By (Employee Name): _______________________________

Approved By (Regional Head): _______________________________

Approved By (HOD): _________________________________________

Disbursed By (Accounts Dept): _________________________________

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