💰Bonuses

[the_ladyplumber]

Let talk about employee bonuses. How often do you give them if at all? How much don you give? What determines the amount and frequency?

I am now a very small company after heavily downsizing. I have given many frequent bonuses in the past but noticed that after sometime it was expected, even if drive, workmanship and work quality decreased (exponentially sometimes). I’m looking into better system rather than just “whenever” as I do want to be generous with profits, but also don’t want the same thing happening where I started feeling walked on afterwards…

 

[KAyersETC]

We have bi-annual profit sharing, that is determined by a formula of consisting of value score, role, and time with the company. We have 4 core values, and the value score is 0-2 scale for each. 0 is lacking, 1 needs improvement, 2 succeeding in that area.

Scores are communicated. No one knows what the bonus will be until it arrives. Everyone is guaranteed one, but again, it's completely determined by what is put into the company.

 

[the_ladyplumber]

We have bi-annual profit sharing, that is determined by a formula of consisting of value score, role, and time with the company. We have 4 core values, and the value score is 0-2 scale for each. 0 is lacking, 1 needs improvement, 2 succeeding in that area.

Scores are communicated. No one knows what the bonus will be until it arrives. Everyone is guaranteed one, but again, it's completely determined by what is put into the company.

Thanks so much for this! When the bonus is given, do you clarify the reasoning behind the amount or let the employee know the rating they received?

 

[KAyersETC]

Thanks so much for this! When the bonus is given, do you clarify the reasoning behind the amount or let the employee know the rating they received?

It's clarified at promotions and initial onboarding about the role and seniority playing a factor. So, everyone pretty much knows the higher up and longer you are here, the bigger the piece of the pie. The value score is clarified if they ask. It's the same value score used for annual reviews, so if they don't ask, they will find out at their review. There is no broad "hey you got 2% this year" or "hey we split up $100k in bonuses", just a bonus that shows up on the paycheck twice a year. Since it fluctuates with profit, there's no "expectation".

 

[KAyersETC]

Thanks so much for this! When the bonus is given, do you clarify the reasoning behind the amount or let the employee know the rating they received?

Also, if it helps, we have "four C's" as our values. Communication. Cleanliness. Character. Check [Everything]. If you want to cuss like a sailor, don't expect a full bonus. If you want to leave scraps around the job sites, don't expect a full bonus. You get the picture. Beyond the bonus, it provides a baseline for promotions, and in some cases terminations. There is a further breakdown where there are 100 traits graded 0-2, and each one gets allotted to a "C" and the annual review is based on their score out of 100. An apprentice wouldn't be able to grade on a project manager, so they aren't expected to have a grade for everything. But essentially, the score out of 100 shows progress from apprentice > technician > foreman > project manager.

 

[the_ladyplumber]

Great info thank you!

Also, if it helps, we have "four C's" as our values. Communication. Cleanliness. Character. Check [Everything]. If you want to cuss like a sailor, don't expect a full bonus. If you want to leave scraps around the job sites, don't expect a full bonus. You get the picture. Beyond the bonus, it provides a baseline for promotions, and in some cases terminations. There is a further breakdown where there are 100 traits graded 0-2, and each one gets allotted to a "C" and the annual review is based on their score out of 100. An apprentice wouldn't be able to grade on a project manager, so they aren't expected to have a grade for everything. But essentially, the score out of 100 shows progress from apprentice > technician > foreman > project manager.

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