Bonus: Negotiable upon arrival
6 March 2009
Read by 1670 persons
Some exceptional bonuses can help attract executives. For companies, they make it possible to avoid upsetting the salary hierarchy.
Far from the golden parachutes of top executives that make headlines, the severance bonus concerns senior executives/managers receiving a salary of around 150,000 euros per year, who are poached. It is then a question of compensating for the risk taking. This bonus is paid if the company parts ways with the employee. "The severance bonus, negotiated upon hiring, is a guarantee that is added to the legal severance pay. It corresponds to one year's salary, and can go up to three years," says Antoine Morgaut, president of Robert Walters France.
One to three years of salary is also what a manager or senior executive can expect to receive when they agree to join a company in difficulty or a high-risk position. Called a sign-on bonus, or "welcome pack," it is intended to compensate for a possible reversal of the situation or the brevity of the mission. Although generally reserved for top management, this bonus is sometimes paid to middle-level managers.
In the case where a company wants, for example, to poach an executive, the "Sign in Bonus" aims to compensate for the loss of potential earnings from a stock option plan. As for the "welcome bonus," which is more common in high-tech companies headquartered in the United States, it can take the form of a week of vacation before integration into the company, or other welcome gifts...
Rewarding Performance
Parallel to these practices reserved for the elite, many companies are putting in place other bonuses intended to reward performance. This is the case with the "MBO all together" (meaning: "management by objectives all together"). This special bonus will be awarded to division managers of a group based on the results around a common project. It is the result of a specific, time-limited strategy (one to two years maximum), with precise objectives such as conquering new markets, stopping margin erosion... This leads to a breakdown of divisions, with managers and their teams working together.
Another common practice: offering financial compensation for a non-compete clause. To be applicable, the latter must meet four conditions: have the purpose of protecting the legitimate interests of the company; have a limited scope in time and space; take into account the specifics of the employee's job; provide compensatory compensation. To be valid, this must represent more than 20% of the employee's annual compensation.
Posted on September 15, 2008
newzy.fr
Far from the golden parachutes of top executives that make headlines, the severance bonus concerns senior executives/managers receiving a salary of around 150,000 euros per year, who are poached. It is then a question of compensating for the risk taking. This bonus is paid if the company parts ways with the employee. "The severance bonus, negotiated upon hiring, is a guarantee that is added to the legal severance pay. It corresponds to one year's salary, and can go up to three years," says Antoine Morgaut, president of Robert Walters France.
One to three years of salary is also what a manager or senior executive can expect to receive when they agree to join a company in difficulty or a high-risk position. Called a sign-on bonus, or "welcome pack," it is intended to compensate for a possible reversal of the situation or the brevity of the mission. Although generally reserved for top management, this bonus is sometimes paid to middle-level managers.
In the case where a company wants, for example, to poach an executive, the "Sign in Bonus" aims to compensate for the loss of potential earnings from a stock option plan. As for the "welcome bonus," which is more common in high-tech companies headquartered in the United States, it can take the form of a week of vacation before integration into the company, or other welcome gifts...
Rewarding Performance
Parallel to these practices reserved for the elite, many companies are putting in place other bonuses intended to reward performance. This is the case with the "MBO all together" (meaning: "management by objectives all together"). This special bonus will be awarded to division managers of a group based on the results around a common project. It is the result of a specific, time-limited strategy (one to two years maximum), with precise objectives such as conquering new markets, stopping margin erosion... This leads to a breakdown of divisions, with managers and their teams working together.
Another common practice: offering financial compensation for a non-compete clause. To be applicable, the latter must meet four conditions: have the purpose of protecting the legitimate interests of the company; have a limited scope in time and space; take into account the specifics of the employee's job; provide compensatory compensation. To be valid, this must represent more than 20% of the employee's annual compensation.
Posted on September 15, 2008
newzy.fr
