Variable Pay: Is There a Difference Between a Bonus and an Incentive?

Compensation Today

Is there a difference between a bonus and an incentive? Under the umbrella you can find any number of bonuses, incentives, commissions, and other cash comp that is contingent on something happening. Bonus” falls under the umbrella. Choosing Incentives or Bonuses.

Should You Offer a Signing Bonus?

HR Daily Advisor

Whether you call it a hiring bonus, a signing bonus, or a sign-on bonus, the idea is the same: It’s a bonus offered to a job applicant to entice him or her to accept the position. Should You Offer a Signing Bonus? Should You Offer a Signing Bonus?

Why Today’s Incentive Thinking Is Different

Achievers

Too often in human history, this meant that people with less power were simply compelled to work, and incentives — if they existed — consisted merely of being allowed to survive. The Central Challenge of Giving Incentives. Stats That Prove the Value of Incentives.

Compensation Cafe: The Contradiction of Annual Incentives

RecognizeThis!

Incentives are only effective when they match the timeframes of employees’ motivation to perform. In light of a recent Willis Towers Watson report on the ineffectiveness of annual incentives, I wanted to take a closer look at how and why they motivate employee behavior. By Derek Irvine.

Long-Term Incentives for a Short Term Generation

Compensation Cafe

Second, this means that the majority of these workers do not intend to benefit from the entirety of their Long-Term Incentives (LTI). Designing LTI to attract, motivate and retain the “next” generation: Opportunity 1: Consider “Mid-Term Incentives” that link to Long-Term Incentives.

Give a Bonus of Heartfelt Appreciation This Year

RecognizeThis!

Even after a difficult year, giving employees the appreciation and recognition they deserve is an important bonus. Employees were rightly concerned that years-long traditions around holiday bonuses might not materialize. I didn’t expect [a Christmas bonus] at all.

When Incentive Pay Goes Rogue!

Compensation Cafe

A friend of mine likes to say: “It’s not that incentive pay doesn’t work well, it’s that it works TOO well. Like any well-designed incentive compensation plan, Wells Fargo’s started with a strong company culture and a simple goal that required special effort.

Compensation Cafe: Employee Engagement and Incentives Compensation

RecognizeThis!

Then today, I blogged “The Tricky Business of Incentive Compensation,” examining research on when and how incentives can motivate, given the typically low performance of such schemes. by Derek Irvine. Recognize This!

Cafe Classic: Is Your Incentive Plan a Strategy Killer?

Compensation Cafe

Editor's Note: Do your incentive plans make the right decisions seem wrong and discourage the choices most critical to your organization's future? Are your incentive plans designed to support or defeat your organization's business strategy?

Turtles Confirm that Incentive Pay Works!

Compensation Cafe

The discussion regarding the efficacy of incentive compensation is ongoing. We tend to think of incentives as based on job descriptions and tasks people normally perform. Instead of the incentive being pushed on recipients it was only available via request.

The Not-so-secret Formula to Making Incentives Work

RecognizeThis!

To be effective, recent research suggests incentives are best paired with recognition. Whether or not incentive programs are effective has been a long standing question, spanning multiple academic disciplines. Bonus & Incentives Social Recognition employee motivation incentives

Friday Five: Year-End Bonuses

Workology

Between scrambling to finish our holiday shopping, avoiding embarrassing ourselves at the office party, and planning our spring vacation – soon, friends, it’s coming soon – we’re busy seething over someone else’s year-end bonus. It’s that time again.

The Real Cost of Mismanaged Incentives: Wells Fargo

Compensation Cafe

Today is a steaming jolt of quadruple espresso in response to the Wells Fargo incentive pay mess. If you have been under a log for a couple of weeks, please start by reading a couple of earlier Compensation Café Articles (my own When Incentive Pay Goes Rogue!

Your Brain on Incentives

Compensation Cafe

b) This is your brain on incentives. What can we possibly learn about incentive compensation from functional magnetic resonance imaging (fMRI)? Incentives/Bonuses Pay for Performance incentive pay pay for performance performance pay variable pay

Does Incentive Compensation Really Motivate Employees?

HRsoft

Incentive compensation continues to work for many organizations, but does it truly motivate employees to contribute their best efforts? To understand whether incentives can truly drive performance, it’s important to understand the difference between extrinsic versus intrinsic motivation.

Training in Channel Sales and Incentives

WorkStride

Often, companies will just provide a flyer with incentives and instructions on how to submit claims. Here we will discuss some of the top five key reasons you should provide training documentation on your products and brand, especially within an incentive program. They would just be pushing a product to get a bonus. Further, if your incentive program allows for it, incorporate a training program into the incentive.

Incentive Plan Success? Think Big Picture, Act Small Picture!

Compensation Force

Incentives remain one of the most powerful, and yet also one of the most misapplied, management tools out there. While research has shown that group incentives can deliver significant return on investment ( CARS research showed a median plan ROI of 134% - or $2.34

Incentive Plan Success? Think Big Picture, Act Small Picture!

Compensation Force

Incentives remain one of the most powerful, and yet also one of the most misapplied, management tools out there. While research has shown that group incentives can deliver significant return on investment ( CARS research showed a median plan ROI of 134% - or $2.34

SHRM 2017: Mykkah Herner and Pay Incentives

HR Daily Advisor

Today I attended a session by Mykkah Herner, the Compensation Evangelist at Payscale, entitled Effective Incentive Plan Design. The focus of his talk was on variable pay plans and how they fit into an overall pay incentives strategy. Bonuses, he says, “may or may not have a plan.

The 5 Elements of a Good Incentive Plan

Compensation Today

Offering incentives is a practice that has seen increased popularity over the past decade. In PayScale’s 2017 Compensation Best Practices Report , over 60 percent of organizations surveyed said they give individual incentives, and nearly a quarter of them reported giving team incentives.

How Do Team Bonuses Impact the Bottom Line in a Retail Setting?

Compensation Cafe

Some things are easy to measure: revenue per quarter, profit margin, average incentive pay received by employees per month, and so forth. Other things, like measuring the increase in revenue or the change in profit per dollar spent on incentive pay, are a bit more difficult.

Cafe Classic: Can Incentives Rise Above the Bad Rap?

Compensation Cafe

Editor's Note: I notice that people tend to gather at the two extremes of thought regarding financial incentives. Group 1 regards incentive compensation as the antidote to all ills, the solution to every problem that exists in human motivation and performance.

How To REALLY Design an Incentive To Drive Behavior

What is Paul Thinking

Incentive for Reducing Travel Costs. If you do all three, you get a bonus of 20 points.” This company was using the article as a way to communicate to potential clients that using points-based incentives are the way to reduce travel costs.

Incentive Pay is Like a Par 4 Golf Hole

Compensation Cafe

Executive Compensation Incentives/Bonuses Pay for Performance Sales Compensation Stock/Equity Compensation bonus equity compensation golf incentives LTI par 4 performance units sales compensation sales pay short term incentive

Incentive Plans Work Too Well (here’s the trick)

Compensation Cafe

It's not that incentive plans don't work well, it's that they can work too well in motivating unintended consequences. Are any incentive compensation experts shocked by this? The failed Wells Fargo incentive plan and Tax Reform are similar.

Cafe Classic: The Key to the Successful Annual Bonus is Truth, Clarity & Alignment

Compensation Cafe

Editor's Note: With today's Classic, a call to walk the talk - or at least honestly talk the walk - when it comes to annual bonus awards. This gets them out of the admittedly difficult (particularly these days) task of pre-defining goals and bonus parameters.

Tips for Safety Incentive Programs

HR Daily Advisor

A safety incentive program is one option for employers to implement to help to improve safety in the workplace. What Are Safety Incentive Programs? First off, what are we talking about when we say “safety incentive program”?

[Infographic] Top 10 Best Workplace Incentives

Get Hppy

Vacation bonuses. But are incentives like these actually worth it? Morale-boosting workplace incentives will reduce turnover and its associated costs. Many companies hesitate to start incentives programs because of the costs it will incur. Gourmet meals. Game rooms.

Everyone Gets a $100,000 bonus!

Compensation Cafe

When 1,380 employees got a $100,000 bonus each, the story should have made headlines everywhere. The brilliant bonus decision was a wonderful example of a corporation that cares deeply about its employees.

An Unpopular Sales Incentive Plan Design Fiasco

Compensation Cafe

The new sales incentive plan was not well received. Their disapproval disappointed the corporate headquarters compensation experts tasked with the duty to faithfully but delicately comply with the incentive program guidelines supplied by the division's senior management.

Beware of Bonus Pitfalls: Overtime and Nonexempt Employees

HR Daily Advisor

I received a call recently from an employer that wanted to know if it could exclude a newly created job category from an annual bonus program. The employer told me it hadn’t thought about doing so because this bonus was paid only once, on an annual basis.

What’s a Signing Bonus? Should You Offer One?

FingerCheck

If you’re looking to attract new talent, a signing bonus is one way to sweeten the compensation package you offer to highly qualified candidates. Unlike traditional benefits like healthcare insurance, paid sick days, and vacation/paid time off, a signing bonus is a one-time benefit paid at the start of employment with the company. . The typical signing bonus is given at a rate of between 5-10% of the base salary and is taxed at 25%.

Hot topic: Paying bonuses

Strategic HCM

There's an interesting piece in HR Magazine today questioning whether bonuses are an effective reward mechanism. The article includes comments from Craig Newman, chief executive of Woodford Investment Management which gave up paying bonuses last year.

Incentives Without Teeth

Compensation Cafe

The title of this post probably had you thinking about incentive plans that required real goals to be met before payment was earned. Many companies have incentive plans without links between individuals, teams, departments and the company as a whole.

Autonomy, Incentives and Motivation

Compensation Cafe

With this kind of autonomy, monetary incentives reinforce intrinsic motivation. Even competitive incentives awarded on a discretionary basis have this reinforcing effect. Incentives are not viewed as an instrument of control.

Using Incentive Compensation Software to Drive Performance

HRsoft

Incentive compensation is the process of paying employees based on the performance of an entity. For this reason, many organizations have increasingly turned to incentive compensation software. Incentive Compensation Examples. Incentive Compensation Best Practices.

New IRF incentives study: Cash rewards not always that rewarding

Maritz Motivation

So says a new study by the Incentive Research Foundation, Award Program Value & Evidence. How today’s businesses are measuring the ROI on their incentive, reward and recognition programs, both tangibly and intangibly . Cash rewards or bonuses can become conflated with regular salary in other ways, too. For example, if the annual employee bonus is based on company performance, there’s no ironclad guarantee they’re going to get it. What’s better than free money?