Retention bonuses - if everyone gives them, they are nonsense

[frankfriend]

We are told that Finance Houses & Banks have to pay large bonuses to make people stay. But if every outfit like that does the same thing, then the retention bonus does NOTHING. If you leave and join someone else they will welcome you with open arms, pay you a golden hello, then pay you a retention bonus. Tis a load of claptrap.

 

[rahulkhatri]

its the corporate world bro

Info is the most important to all the companies

 

[frankfriend]

Yup, when the samew closed group decide their own rewards, and judge & jury, then guess hiow threy behave.

I agree info is the valuable commodity, but I think their personal rewards are the most` important to the decision makers.

 

[JKoltner]

Frankfriend -- Different firms still pay different "bonuses," but you're correct that it's pretty silly to call it a "bonus" when pretty much everyone does it and it's not really a "bonus" in the "usual" meaning of the word at all.

I'm told there might be some tax advantages to compensating your employees with different "types" of funds, though (salary, bonuses, medical insurance, etc.), and this might be one reason companies do it rather than just bumping up salaries instead.

If your goal is strictly to maximize your income, assuming you're talented in your field (but just want to work as a tech/engineer and don't plan to move into management), you definitely do better finding yourself a new job every 3-5 or so than staying at the same place *on average*. I would advise anyone who's single and just getting out of college to specifically plan on finding a new job every, say, 4-5 years for a decade or so prior to "settling down" at a company they really like -- you get a lot more experience, see a lot more interesting things, and in general are more valuable.

Somewhere in there you should put away enough money for 3-12 months of living and take a world-wide vacation as well -- while you may very well have another chance to do so after retirement, physically there are a lot of things you can do at 25 or 30 that you can't (or at least shouldn't) be doing at 65.

 

[frankfriend]

How true, never put off until retirement what you can do today, cos then you may be too damned old. And anyway you couldn't afford the insurance.

 

[Any_Key]

I don't view these as "Bonuses" because they are expected, negotiated, and apparently it takes congress to keep failing companies from paying them out with our money.
Furthermore, the question should really be asked as to what the specific legal language in the bonus contracts is. If what I've heard about really are bonuses meant to keep employees who have done well as to avoid them going to a competitor then it is a merit based system. I see a problem with giving a bunch of people a merit bonus when their companies have produced record losses to the point where tax payer money is being used to cover the gap. (I have a problem with tax money going directly to private companies anyway, but that's a different topic.)

Here's your new bonus: we might not replace you in the next quarter, provided reviews show you have been trying to advance the company in a legal way given the current economic situation.

 

[frankfriend]

At lower levels I guess the bonus is rather like a pension. i.e. it is a delayed payment held over by the employer to make sure you stay, but will never be overcome by sudden wealth. Often regular employees' bonuses are really just a delayed part of your annual salary, whilst a pension is a life-leash!

Of course this pension thing is` more in the UK - final salary pensions there are also vanishing as the economy lurches back into the age of Gradgrind and the hard faced mill owners of the past. They are still there, with their disciples and enforcers.

 

[alcramer]

I'm a self-employed software engineer developing a new technology that will eventually make me a lot of money. I hope. Recently I've been a bit discouraged -- horrible economy, & I'm having trouble re-inventing myself as a marketing person -- so I paid myself a 1 million dollar retention bonus & immediately felt much better. I'd feel even better if I actually had the million to make good on the check I wrote to myself, but as long as I don't try to cash it's fine.

 

[zen-r]

I'm a self-employed software engineer developing a new technology that will eventually make me a lot of money. I hope. Recently I've been a bit discouraged -- horrible economy, & I'm having trouble re-inventing myself as a marketing person -- so I paid myself a 1 million dollar retention bonus & immediately felt much better. I'd feel even better if I actually had the million to make good on the check I wrote to myself, but as long as I don't try to cash it's fine.

Nice idea. Don't forget to accept voluntary redundancy from your own company, then give yourself a "Golden Handshake" when you leave. Lol