Tell them first, privately, before anyone else hears it, with the compensation answer already decided. Lead with reasoning about the account rather than the rep’s performance, state the pay outcome unprompted, name their specific contribution to the relationship, and give them a role in the handoff. Compensate the loss through a consistent mechanism written into the comp plan: continued commission for twelve to eighteen months at a declining rate, a one-time transition payment based on trailing account value, an immediate quota reduction matching the revenue removed, or first claim on the next territory expansion.