Keller Williams cancels plan to cut profit share for ex-agents
President and CEO Mark Willis called the move “unprecedented," and said the vote by the company’s agent-led IALC passed by an “overwhelming majority.”
With lawsuits mounting, Keller Williams has reversed course on its plan to cut profit sharing for agents who leave the company to work for competitors.
The company's International Associate Leadership Council had decided last summer to reduce the profit-share distribution from 100% to 5% for competing agents. Former agents who retired or left the industry would have been unaffected.
On May 16, the IALC voted to undo that decision and maintain the status quo after KW CEO and President Mark Willis requested that the group do so, KW spokesman Darryl Frost confirmed.
The move came after an increasing number of lawsuits had been filed by former KW agents who argued that changes to the profit-sharing program cannot be made retroactively.
What KW had to say: Willis called the meeting "unprecedented," adding: "The vote, which required everyone to take a close look at our values and the structure of our business, wasn't taken lightly."
An "overwhelming majority" of IALC members approved the change.
"While members of the IALC typically meet at our annual events, this moment called for a special gathering to discuss the future of KW's profit share program," Willis said. "The outcome serves as a reflection of our commitment to integrity, teamwork, and finding a win-win for all involved."
More about the profit-share program (and the IALC): KW Co-founder and Executive Chairman Gary Keller created the leadership council in 1986, and the group came up with an early version of the profit-share program, which launched a year later. It was created to ensure that "the goals of franchise owners and agents remain permanently aligned," Frost explained.
"A profitable Market Center shares roughly 50% of its office's monthly profits with associates who have helped the business grow during a given month," Frost said.
The International Associate Leadership Council is made up of representatives from among KW's associates and market centers — what the company calls its brokerage franchisees — and regions in the United States and Canada.
With its vote this week, "the IALC chose to reinforce our profit-sharing model as a cornerstone of everyone's collective success," Willis said.