The Weirdness of Bonuses

January 20, 2020

The rhyme-and-reason -- or lack thereof -- of bonuses.

Fourteen-and-a-half years post-fellowship, and I just received my first end-of-year bonus.

Technically, I suppose, I was offered a holiday bonus in my very first job out of training. The skinflints who ran the place had gotten ahold of a bunch of coupons for free turkeys from a local supermarket-chain, and anybody who wanted got one. Not having eaten turkey for about 18 years at that point, I didn’t bother taking mine.

By the time I joined my subsequent job, its guy in charge had pretty much stopped giving bonuses. When he had given them, I’m told, they invariably came with a song-and-dance about how tough times were for him. I don’t know if the intention was to make the recipient feel guilty or to pave the way for bonusing less (or nothing) in subsequent years. Then, I had a few years with vRad, and in an “eat what you kill” atmosphere like that, bonuses don’t tend to exist.

Bonuses are kind of an odd thing anyway, if you think about them. By definition, a bonus is something you didn’t reliably have coming to you. It flies in the face of “bonuses” as offered by any number of workplaces, where the extra stuff is tied to good performance, years of tenure, etc. In other words, it’s incentive-pay. And, if given with any regularity, it’s something that employees-surprise!-do start to consider as something they have coming to them.

The waters between incentives and true bonuses have been muddied to the point that distinctive definitions are almost not possible; just about any employer is going to offer a slightly different flavor, regardless of what words they use to describe their policies.

At one end of the spectrum is a bonus most closely matching the dictionary-definition of the word. The boss is essentially Santa Claus, and presumably rewards those who behaved nicely. Maybe Santa has a highly-detailed system of determining and keeping track of nice versus naughty behavior, or maybe it’s a gut-reaction after contemplating the preceding year-nobody but Santa-Boss knows.

To the rank and file, it might seem like Santa plays favorites or decides randomly. But, it is a bonus: If you don’t get one, you can’t reasonably claim that Santa done you wrong, because you don’t know what, if any, criteria for bonusing you failed. You have about as much of a leg to stand on as you would in castigating some distant cousin for not sending you a present on your birthday.

The same goes for the particular amounts Santa-Boss is giving out if they aren’t equally distributed to everyone. Everyone can guesstimate reasons why employee X got more than employee Y. They can form theories, maybe after seeing patterns of bonusing over a period of years.

The only way to know for sure would be to ask Santa-Boss directly. But, that risks irritating him or her and jeopardizing one’s future bonuses. Even if not, Santa-Boss doesn’t have to answer in thorough detail or even conduct next year’s bonuses according to the same rationale.

At the other end of the spectrum is a 100-percent transparent system of incentive-pay. All the rules as to who can get what are spelled out to the last decimal, and if you keep track over the course of the year you can know what your bonus is (or at least your percentage, if it’s based on what the group’s net profit for the year turns out to be). It might as well be written into your contract-and, indeed, it sometimes is.

I think individual preferences about bonuses (other than “More! Gimme more!”) probably run similar to those regarding income-tax refunds. Lots of people like hearing that they overpaid in taxes with their withholdings-or estimated payments-over the course of the year, and are, thus, receiving a check back from the government. It’s like getting a bonus from yourself…which can be exactly what you need, if you’re not so good at living within your means and/or putting something aside for retirement. Presto! Here’s some extra slack for such purposes.

Others regard it as having needlessly given the government an interest-free loan, and simply a matter of reclaiming their own property which could have been used for other things in preceding months. I imagine such an individual might be inclined to tell a bonusing employer: “Look, every year I get a bonus of about X. I sure appreciate that, but can we just give me X/12 in my regular salary every month from now on? If my performance deteriorates, I’ll understand that we have to revisit the issue.”

Myself, I’m just going to savor that it only took four jobs before I found a place that uses something beyond nice, cheap words to express appreciation for my efforts.