Workzone: Bonuses more elusive but perks can replace them
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It used to be that bonuses were practically an automatic part of the compensation package at many companies -- either at Christmas or after a performance review.
In the recent recession when many companies scrambled to stay profitable, a popular alternative to avoid cutting the work force was to reduce or eliminate the standard year-end bonus.
Today, if bonuses are offered at all, they are more likely based on individual performance.
"I'm definitely a believer in performance-driven bonuses," said Ann Rhoades, who has worked as an executive at JetBlue Airways, Southwest Airlines and Doubletree Hotels. "It motivates at a different level."
Ms. Rhoades, who is author of the recently released book "Built on Values: Creating an Enviable Culture that Outperforms the Competition," said the typical holiday bonus given without any relevance to performance does little to inspire innovation in the workplace.
"When employees know they are being rewarded on performance, it's energizing," she said. "If [you] get a bonus automatically, it becomes part of your salary in your mind, and when you don't get it, it's not only a surprise, but probably a de-motivator."
Andrew Sassaman, a division manager at Robert Half Management, a global staffing firm with an office Downtown, said that in the absence of bonuses, employees are looking for other types of perks from employers, such as subsidizing expenses for continuing education, flexible work schedules, opportunities to telecommute and mentoring programs within the organization.
"Companies have less money to pay bonuses, but still want to show employees they care," said Mr. Sassaman. "Offering perks is a way for companies to show appreciation for employees without significant financial output."
First Published January 16, 2011 12:00 am
