What is OTE?
OTE stands for on-target earnings, a term mainly used in sales and roles where pay is tied to results. It reflects the total expected earnings — base salary plus commission or bonus — if an employee meets all their performance targets.
OTE helps set clear expectations and shows how strong performance can be rewarded, keeping personal and business goals aligned.
Being upfront about OTE in job descriptions supports transparency and helps attract motivated candidates. Actual earnings may be higher or lower than OTE, depending on results.
Things to know
- OTE is most commonly used in sales, recruitment and other incentive-driven roles
- The figure includes both guaranteed pay (base salary) and variable pay (like bonuses or commission)
- OTE is usually based on hitting 100% of performance targets set by the employer
- Understanding OTE helps manage expectations for both employees and employers
FAQs
What does OTE mean?
OTE is short for on-target earnings. It’s the total pay expected if a worker reaches all performance targets.
Is OTE guaranteed pay?
No, OTE includes both a base salary and what an employee could earn through bonuses or commission.
Who usually has OTE pay?
The key roles are ones in sales, recruitment and any others that include performance-based incentives.
Can a worker’s earnings be more or less than OTE?
Yes. If an employee exceeds their targets, they might earn more. If they don’t meet their targets, their total pay could be lower than OTE.
Why do job ads list OTE?
The main reason is so candidates can get a clear idea of their potential earnings when comparing roles and compensation packages.
