How should you pay collectors fairly when their accounts differ?

The short answer

Commission on raw collections pays a collector for the accounts they were given as much as for their own work. A collector on fresh, large balances can out-earn a more skilled one working aged, small accounts that have already been through two agencies. That feels unfair to the people on the hard paper, and in our experience it is one of the main reasons good collectors leave. Fairer pay doesn’t mean everyone earns the same. It means each collector’s pay reflects how well they work the accounts they are given.

How collectors are usually paid

In our experience many collection floors pay a base, hourly or salaried, plus an incentive tied to what the collector collects. Beyond that there is little agreement. When insideARM surveyed agencies about collector commission (2012), it received well over 100 responses and found the plans too varied to sort into a table. The examples agencies gave include:

• commission on collections above a monthly goal;
• tiers that pay a higher rate as collections rise;
• group bonuses on a team’s daily goals;
• deductions for complaints;
• a guaranteed commission for new hires during their first year.

Why raw commission can be unfair

• Pay follows the paper. In our view, a collector’s collections are the collector plus the accounts they were given. Pay them on raw collections and you pay them for the paper too. What a fair collector scorecard measures.
• New collectors get hit twice. Where the best accounts go to the best collectors, new collectors work the hardest accounts on the lowest base. The Alexander Group describes a sales team where newly hired reps were given territories "with little to no revenue potential", on a plan with a low base and a high incentive. The new reps earned far less, and most of the reps who left were new (case study). Why collectors quit, and how to reduce turnover.
• Collectors can’t see how their pay will grow. Writing in Call Centre Helper (2016) about contact centre agents, Kasia Swatowska described agents who don’t understand how they would ever get a rise, and long-serving agents paid what a new starter earns. In our view a pay plan collectors can’t work out for themselves does little to motivate them.
• Dollars at any cost. In our view a plan that pays only on dollars rewards pressure. The CFPB’s 2016 bulletin on production incentives said incentive programs can pose risks to consumers "especially when they create an unrealistic culture of high-pressure targets", and named collections benchmarks among them (Federal Register, 2017). The CFPB withdrew that bulletin in May 2025 with 66 other guidance documents (Federal Register, 2025), though in our view the risk it describes is still real.

Ways to make collector pay fairer

1. Share accounts fairly first. No pay plan can make up for a split that hands some collectors the best paper and others the worst. How to share accounts fairly across collectors.
2. Set goals by the paper. In our view each collector’s goal should reflect what accounts like theirs usually return, by balance, age of the debt and how many agencies have worked it, so a collector on hard paper is measured against hard paper. Where a kind of account has too few accounts to judge, pool it with similar ones or read it over a longer period.
3. Reward the improvement a collector makes, not only the total. In our view paying on collections above what similar accounts usually return pays for the work rather than the luck of the draw.
4. Protect new collectors while they ramp. One agency in the insideARM survey guaranteed new hires a set commission for their first year. In our view a guarantee like that, or a higher base for the first months, keeps new collectors earning while they learn. How to get new collectors productive faster.
5. Keep it clear and reachable. Every collector should be able to work out their own pay and see what it takes to earn more. The withdrawn CFPB bulletin said sales and collections quotas should be "transparent to employees and reasonably attainable", which in our view is good practice whether or not anyone is checking.
6. Pay for quality as well as dollars. Kept promises, clean quality reviews and few complaints belong in the plan alongside collections. When insideARM published its survey, the author asked whether commission and bonus programs affect how well collectors follow company policies and training that encourage educating the consumer and other complaint-minimising behaviour.
7. Settle the crediting rules. Decide who gets the credit when two collectors spoke to the consumer, and how payments through the portal or by recurring debit count, before anyone’s pay depends on it. How payments are credited to collectors.
8. Test before you change. Run any new plan against last quarter’s real results, see who would earn more and who less, fix the surprises, and tell the floor what you found before it starts.

Team leads and managers

Pay plans for team leads shape the floor too. In our view, if a team lead is paid or judged on headcount or on never losing anyone, they will hold on to collectors who are struggling, and if they are paid only on their team’s raw collections, they will fight for the best paper. Tie team leads’ pay to how their collectors do against what their accounts usually return, and to keeping the collectors the floor most needs.

Where agent matching fits

Agent matching changes the accounts each collector works, not the pay plan. BestPair sends each account to the eligible collector who has done best with accounts like it, from the floor’s own call and payment history, inside the workload limits the agency sets. In our view it can take some of the luck of the paper out of the picture, because accounts go to the collector who has done best on accounts like them, but we haven’t measured its effect on pay. Your commission plan stays yours, and any change in the mix of accounts should be run through it before the start. How to get collectors to accept a new way of assigning accounts.

Sources

• Are These the Best Practices in Collector Compensation?: insideARM, 11 January 2012, verbatim survey responses from agencies on collector commission plans.
• Detecting and Preventing Consumer Harm from Production Incentives: CFPB Bulletin 2016-03, published in the Federal Register on 18 January 2017.
• Interpretive Rules, Policy Statements, and Advisory Opinions; Withdrawal: Federal Register, 12 May 2025, the CFPB’s withdrawal of 67 guidance documents, including Bulletin 2016-03.
• A Software Company Looks at Benchmarks to Understand Reasons Behind Rep Turnover: Alexander Group case study; a consultancy’s account of a client.
• 4 Reasons Agents Quit Their Jobs: Call Centre Helper, Kasia Swatowska, 10 February 2016.