People who left Keller Williams for a competitor have begun receiving letters telling them that their profit share earnings will be reduced from 100 percent to 5 percent.
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A little over three months after Keller Williams announced it would slash profit share earnings for agents who fled to competitors, the company’s market centers have begun notifying individuals of the coming changes.
A letter from a KW market center, obtained by Inman this week, reminds recipients that due to a decision in August, profit share earnings for people qualifying as “competing associates” will go from 100 percent to 5 percent. The letter also notes that such individuals will receive a 30-day notice before the reduction occurs, and that they “will have six months from the day the reduction occurs to return to Keller Williams and be reinstated to your status before the reduction to 5 percent.”
“This will go into effect on or before July 1, 2024 and you will receive another notification 30 days in advance of this implementation,” the letter adds.
The letter further notes that individuals who return to Keller Williams within the six-month timeframe will go back to getting 100 percent of their profit share earnings. The letter concludes by stating that “details are still being refined around timing and reporting for this, though all changes are expected to be implemented no later than end of second quarter 2024.”
Inman obtained the letter from a source who asked not to be publicly named. The letter came from an independently owned market center, and the source said it was distributed widely. The letter also includes additional information about renewing company fees that is typically distributed at this time of year, and would thus have gone out to individuals who aren’t impacted by the profit sharing changes as well.
Keller Williams first announced the details of the profit-sharing cuts at its August Mega Agent Camp in August. At the time, President Marc King said the decision was made to support “those who continue to grow and journey with us.” The company also noted at the time that it would send a letter to vested agents — or those who remain at KW for seven consecutive years — affected by the policy giving them six months to return and not have their profit share cut.
Though the letter Inman obtained this week largely reiterates those previous announcements, it is significant that the company’s market centers have now begun the process of individually notifying individuals about the upcoming cuts.
The cuts come after a 2019 push from some top KW earners to limit the profit share program to associates who remain with the company. That push led the franchisor in 2020 to trim the program for defectors who joined KW after April 1, 2020, then later left for a rival. The latest change is more sweeping, impacting individuals who were with Keller Williams before that date.
Both changes are, apparently, designed to reward KW loyalists and prevent competitors from raking in company money.
The current change also appears to be the latest development in a public rivalry between Keller Williams and eXp Realty. In July 2018, for instance, company co-founder and current Executive Chairman Gary Keller challenged all eXp Realty agents formerly with Keller Williams to give back the $1 million in profit sharing they’d received from the company.
Correction: This story was updated after publication to reflect the fact that the letter was not exclusively sent to individuals impacted by the profit sharing changes.