Benefitable Compensation Sample Clauses
The "Benefitable Compensation" clause defines the terms under which compensation is provided to a party when they derive a benefit from a particular action, service, or outcome specified in the agreement. Typically, this clause outlines the criteria for determining when a benefit has occurred, the method for calculating the corresponding compensation, and the timing of such payments. For example, it may apply when a consultant's recommendations lead to measurable cost savings, entitling them to a percentage of those savings. The core function of this clause is to ensure that parties are fairly rewarded for generating tangible benefits, thereby incentivizing performance and clarifying compensation expectations.
Benefitable Compensation a. General Definition. For purposes of an Employee’s Contribution Agreement, “Benefitable Compensation” means all cash compensation for services to the Employer, including salary, wages, fees, commissions, bonuses and overtime pay, that is includible in the Employee’s gross income for the calendar year and amounts that would be cash compensation includible in gross income but for a reduction election under a cafeteria plan, a qualified transportation fringe benefit plan, a 401(k) plan, a 403(b) plan, or a 457(b) plan, subject to the elections in Items 2.3(b) and (c) below.
Benefitable Compensation