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I'm looking at a job post and it states that the salary is from £20,000 - £50,000 per annum and the positions available are for sales, assistant managers, and managers. At the end of the post it says "£20K - £50K plus OTE". Does this mean that the basic salaries range from £20K - £50K and then commission? Or does the £20K - £50K already include commission?

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    Also ask what the targets actually are and what percentage of the team actually achieve their targets. Commission/OTE are only achievable if targets are realistic.
    – user29600
    Commented Nov 13, 2014 at 16:11
  • So as per NickC's answer the pay is 20k, but could be 50k+ including bonuses/comissions etc if targets are met.
    – The Wandering Dev Manager
    Commented Oct 3, 2015 at 15:42

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OTE means On-target Earnings. (See also what Wikipedia has to say.)

It is usually used when an employee has a "variable" component (commission, bonus, etc.) to their compensation.

Their compensation is made up of both base salary plus the variable bonus, commission, etc. "On-target earnings" is used to describe the sum of both of these amounts.

OTE = Base + Commission + Bonus + whatever else can be annualized, like stock.

OTE represents a big "IF" — IF you earn all of your "expected" commission, bonuses, etc.

I think in your case it already includes commission. It says "£20K - £50K plus OTE", but I think that is just poorly written. I would read that as "The OTE for this position is £20K - £50K plus". "Plus OTE" wouldn't make sense, because OTE means total. They also want to show you total numbers that look better, not watered-down base salaries.

Lastly, that OTE is likely extremely optimistic and you need to work down from those numbers. Keep these things in mind:

  • They want to put their best foot forward and not be sticklers for exact mathematical probabilities.
  • They likely set quotas high because they are overly optimistic.
  • They are also likely to set quotas high to push their salespeople.
  • After all that they probably fudge the numbers a little higher still.
  • They say "plus" like real earnings can be higher, too, but my guess is that's statistically unlikely within their organization.
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  • What sort of questions should I ask (concerning OTE) during an interview? I have never taken up a job like this so it would be a new experience for me.
    – user9917
    Commented Jul 9, 2013 at 23:04
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    That actually sounds like a good separate question. I have not been in your same position, but I would ask at least 1) How is OTE calculated? 2) How many employees under the same comp plan reach OTE or better?
    – Nicole
    Commented Jul 9, 2013 at 23:33
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    I think I'll go ahead and ask it as a seperate question. I wouldn't have thought of your second question.
    – user9917
    Commented Jul 9, 2013 at 23:35
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I work for a distribution company and my salary is £34k plus OTE. The reality is that my base wages are £31k a year and £3k a year called "bonuses", which are divided into 2 payments of £1500 (less taxes and other stoppages).

The stoppages can be anything from absenteeism through ill health or accidents to damage to company property. So this part of the salary is not guaranteed.

Overtime is also not guaranteed and as such cannot be included in any calculation.

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