Keller Williams is revealing significant changes are coming to its profit share program for former agents who left to work for a competitor.
On Aug. 16, during a company event in Texas, the franchisor’s International Associate Leadership Council (IALC) voted to revise its profit share distribution policy. As a result of this change, all vested agents actively competing with KW brokerages will experience a reduction in their profit share allocation from 100 per cent to 5.0 per cent.
The company defines “actively competing” as when an agent or associate leaves a Keller Williams brokerage and joins a competitor. Vested agents that don’t actively compete with KW will not be affected.
In a letter to company leaders, Marc King, president of KW, says the changes were made to align “more closely with our core principles and fostering continuous growth” within the company.
Mark King, president, Keller Williams
Provisions for returning agents
The revised policy’s effective implementation date is “on or before” Jul. 1, 2024; it includes a provision allowing agents to restore their profit share to 100 per cent if they rejoin KW within six months of the effective reduction date.
“This change to Profit Share highlights our commitment to supporting those who continue to grow and journey with us,” King writes in his letter.
Background and context
In 2020, KW introduced changes to its profit share program, altering agents’ vesting timelines. Agents joining after Apr. 1, 2020, required seven years to vest, and if they leave for a competitor, they lose profit share entitlements. These changes were not retroactive, thus not affecting those who joined before Apr. 1, 2020. The recent IALC decision predominantly affects agents vested before April 2020.
The profit share system, a cornerstone of KW’s framework, traces its origins back to 1986 when Gary Keller and the first Associate Leadership Council introduced it.
Under this framework, individual Keller Williams market center owners allocate approximately 50 per cent of their office’s monthly profits to associates who have played a role in the business’s growth.
According to a KW spokesperson, the company has dispensed more than $1.58 billion USD in profit share since the program’s launch.
As of Jul. 31, 2023, KW has nearly 4,800 agents across Canada.
Jordana is the editor of Real Estate Magazine. You can reach her by email.
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