Common use of Draw Clause in Contracts

Draw. Employee may, at some time during his/her employment, receive a payroll advance against future commissions. This payroll advance is called a “Draw”. Employee understands and agrees that this Draw is an advance against future commissions earned, a loan, which Employee is responsible to pay back to Employer by way of earned commissions or other means. At the time of the Employee’s termination from Employer (voluntary or involuntary), should Employee’s commissions earned fail to cover his/her Draw Balance, Employee understands and agrees that he/she shall be responsible to repay to Employer, upon demand by Employer, any portion of the Draw which was not satisfied by earned commissions. Furthermore, any remaining Draw Balance will be deducted from the Employee’s final paycheck (regardless of the type of pay included in the paycheck. For example: base salary, vacation payout, commissions, bonus, etc.).