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Keller Williams retracts profit sharing cuts for former, competing agents — July 1 changes won’t happen

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Keller Williams Realty, Inc. (KW) recently announced it would rescind changes to its profit-sharing program that were approved last August.

These changes would have reduced the profit share former vested agents who joined KW before April 1, 2020 that left and actively competed against the company’s franchises (by joining a competitor) would receive — from 100 per cent to five per cent.

The announcement follows a May 16 vote by the company’s International Associate Leadership Council (IALC) to rescind changes to the profit-sharing program set to begin on July 1. This means the program will stay as-is.

 

‘The vote, which required everyone to take a close look at our values and (business) structure, wasn’t taken lightly’

 

In an email to REM, Darryl Frost, spokesperson, Keller Williams, says the IALC “ensures that agents, franchise owners and franchise management have a voice in how they run their businesses within the KW system.” The council comprises representatives of various positions, levels and locations throughout the United States and Canada.

Mark Willis, CEO and president of Keller Williams Realty, Inc. and chairman of the IALC, formally recommended the rescission. This was done as a special case since IALC votes normally happen at company events held in February, and August or September each year.

“While members of the IALC typically meet at our annual events, this moment called for a special (unprecedented) gathering to discuss the future of KW’s profit share program,” Willis notes. “The vote, which required everyone to take a close look at our values and the structure of our business, wasn’t taken lightly.”

 

Vote passed ‘with an overwhelming majority’

 

Frost explains how IALC shapes policy at the company: “During IALC meetings, we invite and expect high-minded, vigorous discussions about proposed changes. These discussions are critical to maintaining our company’s transparency.”

Willis says the vote passed “with an overwhelming majority” and that, “With today’s vote, the IALC chose to reinforce our profit-sharing model as a cornerstone of everyone’s collective success.”

When asked if the decision to rescind the profit-sharing program changes was in response to class-action lawsuits against KW, including damages of $250 million sought, being pursued by former KW agents alleging breach of contract and unjust enrichment, the company did not respond.

 

About the profit-sharing program

 

In 1986, Gary Keller and Keller Williams’ first Associate Leadership Council created the profit share system to ensure the goals of franchise owners and agents remained permanently aligned. An early version of the profit-sharing program was officially launched in 1987.

A profitable brokerage franchisee (internally referred to as a “Market Centre”) shares roughly half of its office’s monthly profits with associates who have helped the business grow during that month.

 

Willis emphasizes how collaboration is core to the KW foundation and culture, “as a company built by agents, for agents.” He goes on to extend “Our heartfelt thanks to today’s IALC participants, whose involvement ensured everyone’s voices were heard and respected on this issue.”

 

Photo: Mark Willis, kwri.kw.com

 


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