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Thanks for the Bonus, I Quit

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Re: Thanks for the Bonus, I Quit

#161

Post by donw »

m463 wrote: post #88
taeric wrote: post #26

This is literally a plot point in Christmas Vacation. Is also why I think it is silly for startups to provide too many perks. It sets obvious precedent and will upset more folks when you stop. Find ways to invest in the company so that success is it's own perk. If the company truly has more, work that into raises where you clearly tie the income to the success of the company.

> Is also why I think it is silly for startups to provide too many perks Should the opposite be true as well? Startup employees going home at 5 and fighting unreasonable schedules?

> Startup employees going home at 5 and fighting unreasonable schedules?

Absolutely.

First, overwork doesn't lead to more productivity for knowledge workers. You get to pay that piper one way or another in the end.

Second, back in the day, if your company was acquired for multiple billions, you had a pretty good shot at a life-changing infusion of cash.

Nowadays, stock options given to employees often end up being worth nothing, even on a successful exit.

Why work hard for a slim chance at bupkis?

Re: Thanks for the Bonus, I Quit

#162

Post by sneak »

tjr225 wrote: post #155
sneak wrote: post #133

Earlier quoted context omitted.

This is what I think of when companies offer the passive-aggressive "unlimited vacation time" policy. It's not unlimited, and you shouldn't start off your employer-employee relationship with an obvious lie. Set a policy and make it clear that you are exchanging x dollars for y amount of work.

I’m back at a more traditional company after being at a startup for two years and the unlimited PTO was amazing. It wasn’t passive aggressive at all and now I sit here one my hands waiting to accumulate enough pto to take an extended break.

It wasn't unlimited though. If startups will let you take 4 weeks, or 8 weeks, or 12 weeks, or whatever - they should simply publish that up front.

I am fairly certain that they would have had an issue with you taking 52 weeks of paid vacation time off per year. The actual policy number is somewhere between 2 and 52.

I agree that 2 weeks of PTO for an employee per year is too little, but I think we are talking about different things.

Re: Thanks for the Bonus, I Quit

#163

Post by u678u »

labster wrote: post #60
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…

But bonuses are compensation! At my last job I had a negative slope on my total compensation, because I’d get raises every time that barely beat CPI, but the bonuses kept shrinking by thousands. I ended up quitting because my promotion to team lead came with a net pay cut and the CTO refused a pay increase flat. And thus ended eight years, because they wouldn’t pay me as much as my colleagues, and cut enough bonuses…

See banking. TC is still less than 15 years ago, esp in London

Re: Thanks for the Bonus, I Quit

#164

Post by kbenson »

taeric wrote: post #26

This is literally a plot point in Christmas Vacation. Is also why I think it is silly for startups to provide too many perks. It sets obvious precedent and will upset more folks when you stop. Find ways to invest in the company so that success is it's own perk. If the company truly has more, work that into raises where you clearly tie the income to the success of the company.

> It sets obvious precedent and will upset more folks when you stop.

Isn't another solution to make perks not variable, and clearly outlined in the contract as part of the employment package? You only have to worry about what your employees will do if you take away a perk when it's actually something you can consider taking away. If you treat it as part of the guaranteed compensation, you'll budget for it accordingly just like your employees do.

If you want to give bonuses, like the parent said make it a flat guaranteed amount, or tie it to a number based on company performance that people can see and make plans for (profit sharing with published numbers at regular intervals, preferably more often than it's paid out).

Re: Thanks for the Bonus, I Quit

#165

Post by sigstoat »

sokoloff wrote: post #115
ldiracdelta wrote: post #21

Earlier quoted context omitted.

I've been at places where you get bonuses and me and the wife always call it "magic money". We don't bank on it and we try to pay down debt or invest it.

We had a quarterly cash bonus program that was variable based on company performance. In the fastest-growth times, it often paid out at the cap (250%). After one such payout, my neighbor stood up and theatrically loudly exclaimed, "I have no idea how this gets determined; I've just been strongly incentivized to act randomly!"

> "I have no idea how this gets determined; I've just been strongly incentivized to act randomly!"

that was certainly how i felt about raises at one job. good reviews every year, but sometimes a big raise, sometimes a tiny raise. no pattern.

once that realization sunk in, i basically checked out of the work.

raises continued with no pattern.

Re: Thanks for the Bonus, I Quit

#166

Post by gonehome »

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…

Yeah, but your example is a little different than the OP's - I think part of this though is that the company is using the 'bonus' effectively as salary but with the idea that they don't have to guarantee its future.

The company treats it like salary, the employees treat it like salary, recruiters probably mention it as part of comp like it's salary, etc.

Then one day they decide not to do it, of course people are pissed. Netflix is right - you can't have 'bonuses' that are not tied to something real (like the article, and even then there are issues). If the formula is explicitly defined and publicly known then fine, otherwise it's a bad idea.

I've found companies that rely on this also tend to underpay on salary, but say things like "we're competitive when you factor in the bonus that basically everyone gets".

If you run a company this way and don't expect blow back when you slash everyone's comp by 6% you deserve the loss of talent.

Michael Lopp has written something similar about the "Thanks for the Bonus, I Quit" in one of his management articles somewhere. The idea being that if you have a direct report and give them a smaller raise than they're expecting when they know peers are got larger raises (in percentage) the act of giving them the raise could be the trigger that gets them to say “I quit”. It might be because they're already on the higher end of the comp range, but without knowing this they'll be frustrated. Working effectively with people and comp takes effort and understanding how people will feel/think about comp.

This kind of sense of fairness goes back a long ways: https://www.youtube.com/watch?v=meiU6TxysCg

I don't think it's realistic to expect people not to behave this way, good managers (and companies) should model it.

---

Also - I doubt the execs at eBay saw less comp during that time.

Re: Thanks for the Bonus, I Quit

#167

Post by lazyasciiart »

whack wrote: post #94

I see a lot of comments bemoaning performance-based bonuses, but consider the following: > I remember being in shouting matches with our signal integrity team about among other things, how many capacitors we needed. These tiny devices evened out the power of the system, but they wanted far too many to be added to allow the design cheap and easy to build > Meanwhile I was waking up at 4AM on most days, in full-stress-…

Your "skin in the game" should not be arbitrarily tied to a metric/achievement that is not under your control or else working to the same objectives. If manufacturing have no motivation to go faster, I have no control over their speed, and I know they'll just take as long as the schedule allows? then screw it, getting it to them early won't help me get my bonus. Now, if manufacturing was also getting a bonus dependent on an early shop date, you're in it together. Or if manufacturing reports to me, I can tell them what to prioritize.

Re: Thanks for the Bonus, I Quit

#168

Post by taeric »

kbenson wrote: post #164
taeric wrote: post #26

This is literally a plot point in Christmas Vacation. Is also why I think it is silly for startups to provide too many perks. It sets obvious precedent and will upset more folks when you stop. Find ways to invest in the company so that success is it's own perk. If the company truly has more, work that into raises where you clearly tie the income to the success of the company.

> It sets obvious precedent and will upset more folks when you stop. Isn't another solution to make perks not variable, and clearly outlined in the contract as part of the employment package? You only have to worry about what your employees will do if you take away a perk when it's actually something you can consider taking away. If you treat it as part of the guaranteed compensation, you'll budget for it accordingly…

This is what I meant by working it into raises. Investing in workers is investing in the company.

Re: Thanks for the Bonus, I Quit

#170

Post by hinkley »

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…

I know of a few companies where the pay isn’t quite competitive without the bonus. If you lose 10% of your income with the same or greater responsibilities (life often gets harder when the money gets scarce), your finances and plans don’t give a shit what you called it, they just know it’s gone.
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