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Thanks for the Bonus, I Quit

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Re: Thanks for the Bonus, I Quit

#41

Post by Redoubts »

jedberg wrote: post #17

When I worked at eBay, we had a bonus program based on company revenue. It was around 6% of your salary max and managers got around 25% max based on the same formula. For the first few years, you could count on getting a max bonus every quarter. To the point where most everyone who worked there had always gotten one. And the one quarter, we didn't get the max bonus. In fact, I don't think we got it all. People scream…

> And the one quarter, we didn't get the max bonus. In fact, I don't think we got it all.

Was there a clear reason for this? Given how it’s framed, it sounds like there wasn’t.

Re: Thanks for the Bonus, I Quit

#42

Post by dehrmann »

dewitt wrote: post #7

> "$25,000 was not enough money to retire on for sure, even in 1996." $25,000 in 1996 is $42,000 in 2021. Seems like a modest incentive for top tech talent, even back then. * To respond to the comment below, the author had been working as a hardware systems engineer at headquarters for 10 years by 1996.

I happened to have this floating around from when I was digging into tech salaries over time.

https://web.archive.org/web/20010203125200/http://www.techwe...

Those are for the Bay Area, not New England (probably important) and for software (less important). He said he'd been at Digital for 10+ years by then, so for a Bay Area salary, I'd guess he made $100k. In New England, I wouldn't be shocked if it was more like $60-$80, so the bonus was up to a third of his salary.

Re: Thanks for the Bonus, I Quit

#43

Post by dilyevsky »

jedberg wrote: post #17

When I worked at eBay, we had a bonus program based on company revenue. It was around 6% of your salary max and managers got around 25% max based on the same formula. For the first few years, you could count on getting a max bonus every quarter. To the point where most everyone who worked there had always gotten one. And the one quarter, we didn't get the max bonus. In fact, I don't think we got it all. People scream…

If i recall the same happened when google replaced their holiday gift phone with donation to some charities they picked.

Re: Thanks for the Bonus, I Quit

#44

Post by bradleyjg »

smitty1e wrote: post #12
sokoloff wrote: post #10

Earlier quoted context omitted.

If you pay a high salary, you create an incentive to just mark time and maximize the number of paychecks collected as well. If you pay in part in equity (or performance-based bonuses), you can balance that somewhat. No pay structure is a substitute for strong leadership, but each system provides pulls in certain directions.

> No pay structure is a substitute for strong leadership Can't emphasize this point enough. Frog$kins are necessary, but not sufficient, for retention. Especially when the talent has enough resources to decide that it isn't tolerating a manager or customer with the personality of a dented wastebasket.

On the other hand a poorly designed or executed comp system will cause unhappiness and distraction even when everyone is paid well. It’s an unforced error of the business world.

Re: Thanks for the Bonus, I Quit

#45

Post by flemhans »

ransom1538 wrote: post #32
jedberg wrote: post #17

When I worked at eBay, we had a bonus program based on company revenue. It was around 6% of your salary max and managers got around 25% max based on the same formula. For the first few years, you could count on getting a max bonus every quarter. To the point where most everyone who worked there had always gotten one. And the one quarter, we didn't get the max bonus. In fact, I don't think we got it all. People scream…

Yes. I had a high school teacher [underpaid] that gave us donuts in the morning. One day that didn't happen. Anarchy. Screaming, yelling, crying, breakfasts ruined. WHAT WILL WE EAT? This teacher was now an evil villain. The teacher learned: never give out free donuts again.

20+ donuts, for how long?

If daily and at $1/nut, that comes out to $100 per week.

Was it just on some occasions or every morning?

Re: Thanks for the Bonus, I Quit

#46

Post by jedberg »

Redoubts wrote: post #41
jedberg wrote: post #17

When I worked at eBay, we had a bonus program based on company revenue. It was around 6% of your salary max and managers got around 25% max based on the same formula. For the first few years, you could count on getting a max bonus every quarter. To the point where most everyone who worked there had always gotten one. And the one quarter, we didn't get the max bonus. In fact, I don't think we got it all. People scream…

> And the one quarter, we didn't get the max bonus. In fact, I don't think we got it all. Was there a clear reason for this? Given how it’s framed, it sounds like there wasn’t.

Yeah it was clear, it was because the total company profit didn't meet the internal target, but that hadn't happened ever in the history of the company, so people were surprised.

Re: Thanks for the Bonus, I Quit

#47

Post by jay_kyburz »

Scene_Cast2 wrote: post #16

I've been thinking about hiring a couple of interns to work on projects that I don't have enough spare time for. One thing that came across my mind is whether I should have some sort of an incentive for coming in under budget or ahead of schedule. On one hand, with hardware projects, sky is the limit for the potential costs (and they wouldn't have a reason to not overspend). On the other, having such an incentive wou…

The problem would be estimating the budget and schedule in the first place. If you are too aggressive it will seem unfair, too lax and you could actually slow the project down.

Pay your bonuses to those people who show up for work on time, work well with others, make smart decisions, and who you would like to work with again in future.

Re: Thanks for the Bonus, I Quit

#48

Post by pbourke »

ransom1538 wrote: post #32
jedberg wrote: post #17

When I worked at eBay, we had a bonus program based on company revenue. It was around 6% of your salary max and managers got around 25% max based on the same formula. For the first few years, you could count on getting a max bonus every quarter. To the point where most everyone who worked there had always gotten one. And the one quarter, we didn't get the max bonus. In fact, I don't think we got it all. People scream…

Yes. I had a high school teacher [underpaid] that gave us donuts in the morning. One day that didn't happen. Anarchy. Screaming, yelling, crying, breakfasts ruined. WHAT WILL WE EAT? This teacher was now an evil villain. The teacher learned: never give out free donuts again.

> The teacher learned: never give out free donuts again.

Or do it either predictably infrequently (major holidays or whatever) or truly randomly.

Re: Thanks for the Bonus, I Quit

#49

Post by nateburke »

This was a joy to read. My aunt, Carli, worked at DEC for a number of years and I recall fondly how proud she was to have a job there. Thank you for sharing this small bit of New England high technology history.

Re: Thanks for the Bonus, I Quit

#50

Post by Consultant32452 »

sokoloff wrote: post #10
Negitivefrags wrote: post #6

I actually think bonuses and equity grants are terrible for comapany morale. I've seen it many times, and heard many more stories. On top of the issue in this story, there are others too. For example, if someone wants to leave, but the bonus or vesting is coming up, they will stay, and you don't want people on a project who don't want to be there. As another example I know people who work at companies that are going…

If you pay a high salary, you create an incentive to just mark time and maximize the number of paychecks collected as well. If you pay in part in equity (or performance-based bonuses), you can balance that somewhat. No pay structure is a substitute for strong leadership, but each system provides pulls in certain directions.

I think the equity thing might be real in a very small company, but I don't think it works the same at a mega-corp where your contribution is generally a drop in the ocean. For example, I currently work for a Fortune 500 financial company and the default company match option is in company stock. I don't think I've ever heard of anyone talk about doing their job better in the context of the stock price.
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