Which type of compensation typically includes commissions?

Sales compensation is designed to incentivize employees, particularly those in sales roles, to achieve higher performance levels. This type of compensation often includes commissions, which are payments based on the sales an employee generates. Commissions provide a direct financial reward tied to the employee's efforts in driving sales and reaching targets.

While hourly wages, a salary, and overtime pay can form part of an employee's overall earnings, they do not typically involve performance-based rewards like commissions. Hourly wages are based on the number of hours worked, salaries are fixed annual amounts irrespective of performance, and overtime pay compensates employees for hours worked beyond standard work hours, again based on time rather than sales performance. Sales compensation, specifically, targets rewarding employees directly for their sales achievements, making it the correct answer in the context of compensation that includes commissions.