Introducer Agreements in NZ: Defining Introductions, Commissions and Legal Risks

If you run a growing business, chances are someone has offered to “introduce” you to new customers, suppliers, investors, or partners - for a fee or commission.

That can be a great way to expand without hiring a full sales team. But if you don’t put the right legal foundations in place, those “simple” introductions can quickly turn into disputes about who owns the relationship, who gets paid (and when), and whether the introducer has crossed the line into being an agent or employee.

This guide breaks down what introducer agreements are, when you should use one, and what terms you’ll want to nail down so you’re protected from day one.

What Is An Introducer Agreement (And When Should You Use One)?

An introducer agreement is a contract where one party (the “introducer”) agrees to refer or introduce potential customers or business opportunities to another party (your business), usually in exchange for a referral fee or commission.

In a small business context, introducers often pop up in situations like:

• Professional services (accounting, consulting, marketing, IT) where referrals are common
• Trades and construction where a person has strong networks and can connect you with jobs
• Online businesses where influencers, affiliates, or community members refer leads
• Wholesale and distribution where someone opens doors to retailers or supply chains
• Startups where someone introduces investors or strategic partners

The key idea is that the introducer is being paid for the introduction - not necessarily for negotiating the deal, signing customers up, or acting on your behalf.

That distinction matters. A well-drafted introducer agreement helps keep your arrangement in the “referral” lane, instead of accidentally drifting into:

• Agency (where the person can bind you to obligations), or
• Employment (where payroll, leave entitlements and other obligations might apply)

If you’re unsure where your arrangement sits, it’s usually worth getting advice early - it’s much easier to structure this properly up front than to unwind it later.

Introducer Vs Agent Vs Contractor: Why Classification Matters

One of the biggest legal risks for NZ businesses using introducers is that the relationship might not be treated as “introducer-only” in practice - even if you call it that in the contract.

Here’s the plain-English difference:

Introducer

• Introduces leads or contacts
• Typically doesn’t negotiate terms, sign contracts, or make promises on your behalf
• Usually paid per successful referral (or sometimes per qualified lead)

Agent

• May negotiate terms with customers or suppliers
• Might be treated as having authority to represent you, depending on what they do and how you present them to others
• Can create legal and commercial risk if they misrepresent your offering

Independent Contractor (Sales Rep / Biz Dev)

• Provides services to you (often ongoing)
• May do outreach, follow-ups, pipeline management, and sometimes negotiation
• Could still be a contractor, but the arrangement needs the right controls and paperwork

Where businesses get caught out is when the introducer starts doing “a bit more to help” - like negotiating pricing, promising deliverables, handling complaints, or saying things that sound like official company statements.

If that happens and something goes wrong, you can end up with:

• Customer disputes (for example, “we were told X was included”)
• Misleading conduct issues under the Fair Trading Act 1986 (especially if statements are made in trade)
• Commission disputes (“I did more than an introduction, so I should be paid more”)
• Employment status arguments if the relationship looks like an employee arrangement in practice

If what you really need is someone providing ongoing services (not just introductions), you might be better off with a tailored Consulting Agreement or a more comprehensive services arrangement - it’s about matching the document to what’s actually happening in your business.

What Should An Introducer Agreement Include?

A good introducer agreement isn’t just about the fee. It’s about setting expectations and reducing the “grey areas” that cause disputes.

While every business is different, most introducer agreements should cover the following core terms.

1. The Scope: What Counts As An “Introduction”?

This is the heart of the agreement. You’ll want to define exactly what the introducer must do to earn a payment.

For example:

• Is it enough to provide a name and email address?
• Do they need to arrange a meeting?
• Does the customer need to be “new” to your business (and how do you define new)?
• What if the lead was already in your CRM, newsletter list, or previously contacted you?

It’s also common to include an obligation that the introduction is made with consent - meaning the introducer is not sending you personal details in a way that creates privacy issues.

2. Payment Terms: Fee Structure, Trigger Events, And Timing

Commission disputes are incredibly common, especially when the arrangement is informal.

Common fee structures include:

• Fixed referral fee per converted customer
• Percentage commission of revenue from the referred customer
• Tiered commission (e.g. higher rate once certain targets are met)
• Milestone payments (e.g. deposit paid, contract signed, delivery completed)

You’ll also want to clarify:

• When commission is earned (on contract signing, on invoice, on payment received, etc.)
• When commission is payable (e.g. monthly in arrears)
• What happens with refunds, chargebacks, or cancellations
• Whether commission continues on recurring revenue (and if so, for how long)

It’s also worth confirming the tax treatment of referral fees/commissions up front (for example, whether GST applies, whether invoices are required, and whether any withholding or payroll-style obligations could be triggered in your specific setup). An accountant can help you set this up correctly.

If you’re selling higher-value services or long-term subscriptions, these details can make a huge difference to your margins - and to whether you can sustainably use introducers at scale.

3. Exclusivity (Or Non-Exclusivity)

Some introducers ask for exclusivity, meaning you can’t use other introducers or channels for the same market.

Exclusivity can work, but it’s also risky if the introducer doesn’t perform.

If you do agree to exclusivity, make sure you also build in protections like:

• clear performance expectations
• minimum referral volumes
• review dates
• termination rights if results aren’t met

4. Restrictions On Conduct (So They Don’t Accidentally “Represent” You)

To reduce risk under the Fair Trading Act 1986 (and to avoid relationship confusion), your agreement should clearly limit what the introducer can do.

Common restrictions include:

• they must not negotiate pricing or terms
• they must not make promises, warranties, or representations about your goods/services
• they must not hold themselves out as your employee, partner, or agent
• they must follow your brand and messaging guidelines (if you provide them)

This is also where you can align the introducer with your internal policies, especially if they’ll access any customer details or marketing materials. If the introducer will handle personal information, you’ll want your privacy settings tight and your Privacy Policy up to date.

5. Confidentiality And Ownership Of Leads

Introducers are often plugged into your commercial pipeline - pricing, strategy, and customers you’re targeting.

That means confidentiality is a must.

At a minimum, the agreement should cover:

• what information is confidential
• how it can be used
• when it must be returned or destroyed
• how long confidentiality obligations last

You’ll also want to clarify who “owns” the customer relationship and any deal documents once an introduction is made. This helps prevent a situation where an introducer later claims the customer is “theirs” and tries to interfere with renewals or upsells.

For some businesses, it makes sense to formalise confidentiality in a separate Non-Disclosure Agreement as well - especially if the introducer will see sensitive commercial info before you decide to work together.

6. Term, Termination, And Post-Term Commission

Don’t leave termination to chance. Even if you’re starting with a friendly handshake arrangement, you’ll be grateful later that you planned for the “what if we stop working together?” scenario.

Common points to cover include:

• how long the agreement runs
• termination for convenience (with notice)
• termination for cause (e.g. breach, misconduct, misrepresentations)
• what happens to introductions already made but not yet converted
• whether commission is payable after termination (and for how long)

This last point is where most disputes happen. If the introducer makes an introduction, you keep negotiating for two months, and the agreement ends in the middle - does commission still apply?

There’s no one-size-fits-all answer, but you do need the agreement to say something clear.

Key Legal Risks To Watch Out For In NZ

Introducer agreements can be straightforward, but there are a few common legal traps that show up repeatedly for NZ businesses.

Misleading Or Unsubstantiated Claims (Fair Trading Act 1986)

If an introducer says something misleading to a potential customer - even with good intentions - it can create serious risk for you.

This is particularly relevant if the introducer is:

• explaining what your product does
• quoting pricing or discounts
• claiming outcomes (“this will increase revenue by 50%”)
• speaking to delivery timeframes or availability

To manage this, make sure your introducer agreement limits what they can say, and consider providing approved wording or a short “script” they can use.

Privacy Act 2020: Sharing Leads And Personal Information

Introducers often pass on names, phone numbers, emails, and business details.

That can be personal information under the Privacy Act 2020, and it’s easy to slip into a non-compliant process - for example, sending you a spreadsheet of contacts without those people knowing their details are being shared.

Some practical safeguards include:

• requiring the introducer to get consent before sharing details
• only accepting leads through a form where the person opts in
• limiting what data is shared (share minimum necessary)
• setting security expectations for storing and transferring lead data

If you’ll be collecting leads online (or marketing to them), it’s also smart to check your website terms and privacy wording are consistent across your funnel, including your Website Terms And Conditions.

Are They Really An Employee?

Small businesses sometimes use introducers as a flexible alternative to hiring.

But if the arrangement starts to look like an employment relationship (for example, you control their hours, they work mainly for you, they’re integrated into your business, or they’re paid like a wage), there’s a risk they could argue they’re an employee.

That can lead to liabilities around leave entitlements, PAYE, and employment obligations.

If you actually intend to hire someone to do sales or business development in-house, it’s usually cleaner to use a proper Employment Contract and set expectations properly from the start.

Competition And Restraints (Be Careful With Overreach)

Some businesses want to stop introducers from working with competitors, approaching the same customers, or using their networks elsewhere.

You can include certain restrictions, but they need to be reasonable and fit the situation - overly broad restraint clauses are harder to enforce and can damage the relationship.

A more practical approach is often:

• confidentiality protections
• clear limits on the use of your materials and data
• non-solicitation (in narrow circumstances)
• clarity about what happens with leads and commission when the relationship ends

Practical Tips To Set Up Introducer Agreements That Work

Introducer agreements don’t have to be complicated - they just need to be clear and aligned with how you actually operate.

Here are practical steps we often recommend before you sign anything.

Step 1: Map Your Sales Process First

Before you decide on commission, define your customer journey:

• What does a “lead” look like for you?
• What counts as “qualified”?
• Who does the follow-up?
• How long does it take to convert?
• What’s your average lifetime value?

Step 2: Decide Whether You Want Pay-Per-Lead Or Pay-Per-Sale

Pay-per-lead can be great if you have a strong internal sales process, but it can also invite low-quality leads.

Pay-per-sale is usually easier to justify, but you’ll need to define the trigger clearly (e.g. “commission is earned once the customer pays the first invoice”).

If your services involve milestones, progress payments or long delivery periods, a hybrid model can work well.

Step 3: Keep The Introducer In Their Lane

If you want an introducer (not an agent), make sure you operationalise that:

• don’t give them authority to quote or negotiate
• don’t let them use your letterhead as if they’re part of your business
• don’t let them handle complaints or contract variations
• give them a simple, approved message about what you do

This is one of those areas where a well-drafted agreement plus good internal boundaries make a huge difference.

Step 4: Make Reporting And Record-Keeping Easy

Disputes often come down to “who introduced who, and when?”

Your agreement can require that introductions are recorded in a particular way - for example:

• an introduction email with both parties copied in
• a submission through a specific referral form
• a written acknowledgment from you within a set timeframe

This doesn’t just protect you - it protects the introducer too. Everyone knows where they stand.

Step 5: Don’t Rely On A Template If The Stakes Are High

If the introducer is bringing you high-value clients, recurring revenue, or investor introductions, the agreement should be tailored.

A generic template might miss:

• how refunds affect commission
• how to handle renewals and upsells
• lead ownership and post-termination commission
• privacy and marketing compliance
• limits on what the introducer can say or do

Getting it drafted properly upfront is usually far cheaper than dealing with a payment dispute later.

Key Takeaways

• Introducer agreements help you grow through referrals while keeping expectations (and payments) clear between you and the introducer.
• The biggest risk is ambiguity - define what counts as an “introduction”, when commission is earned, and how it’s calculated.
• Be careful the introducer doesn’t act like an agent or employee in practice, especially if they negotiate, make promises, or appear to represent your business.
• Make sure your process for sharing leads and contact details is consistent with the Privacy Act 2020, including consent and secure handling of personal information.
• Strong clauses around confidentiality, lead ownership, termination, and post-termination commission can prevent the most common disputes.
• Introducer arrangements can be commercially valuable, but they work best when the contract matches how you actually run sales and onboarding.

If you’d like help drafting or reviewing introducer agreements so your business is protected from day one, you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.