Compliance Guardrails
What you're allowed to do.
The constraint layer—what you can promise, pay, claw back, and enforce… by jurisdiction and role.
When to Pull This Lever
- • Multi-state growth, reclassifying roles, or new clawback terms
- • Acquisitions or repeated wage disputes
The Consequences
What It Moves
Plan document structure • clawback terms • dispute procedures • role classifications • state compliance
Blast Radius
Wage claims • class actions • DOL audits • rep lawsuits • executive liability
Scoreboard
Open disputes • dispute resolution time • legal review coverage • compliance exceptions
Default Artifacts
Plan agreement template • state compliance matrix • role classification doc • dispute SOP
Common Failures
- • Treating commission plans like "policy docs" instead of enforceable agreements
- • Copy/paste clauses that don't survive wage & hour rules
- • Clawbacks that can't legally be executed
- • Dispute language that creates ambiguity (and lawsuits)
Fast Wins
- • Audit clawback and forfeiture terms vs. state law
- • Separate signed plan docs from policy/HR language
- • Add 409A safe-harbor language if deferrals are involved
- • Classify roles correctly (exempt vs. non-exempt) and pay accordingly
Score This Lever
If you can't answer "yes" with proof, you don't score above 2.
- 1Plan document reviewed by employment counsel
- 2Clawback terms are enforceable in all rep states
- 3Role classifications documented (exempt/non-exempt)
- 4Dispute resolution process documented and followed
- 5409A compliance confirmed if deferrals exist
Score: 0 (Missing) → 1 (Documented) → 2 (Repeatable) → 3 (Controlled) → 4 (Optimized)
Maturity Ladder
Verbal
plans exist as tribal knowledge
Written
plan docs exist but aren't reviewed
Reviewed
legal reviews before rollout
Compliant
state-by-state audit complete
Proactive
legal monitors regulatory changes
The Kit
Starter Artifacts
Plan agreement template • clawback audit • role classification matrix • dispute log