What! No Bonus!

In 1997 I moved to Colorado to work as a research engineer. We lived in a small town in the mountains. That’s when I learned that my company had given bonuses in past years but they stopped them because the local merchants were always badgering the company about the bonuses that didn’t come and the smaller- than-usual bonuses.

I didn’t learn this from the company; I learned it from the guy at the hardware store.

When your company cut your bonus and said, “We had to do it because the local merchants complained to us,” they may not be kidding.

Then again, it is reasonable to dump a bonus plan that has gotten out of hand and too expensive.

Our company solved the program by giving a quarterly productivity 꽁머니 pay increase that could be raised or lowered according to productivity. We all liked that. One engineer was fired however because the company didn’t think he was worth the increased pay he was getting through the increased productivity of the factory workers.

From what I learned down at the local hardware store, the factory folks would drop in, pick up a washing machine or refrigerator, and tell the owner that they would pay for it as soon as they got their bonuses. Then they would get no bonuses or a too-small bonuses.

The storeowner would say, OUCH!”

That’s when he would call the factory: “You guys have got to pay a decent bonus over there so that your employees can pay for the stuff they are dragging out of my store.”

So the company stopped the bonuses.

I was reading somewhere the other day that that is still happening.

One company I worked for cancelled our bonuses saying that our pay would be raised to compensate for the past bonuses. They said that they had to stop the bonuses because of the merchant situations described above.

That was a bunch of bull, of course. The truth was that the bonus expense was too high and not justified by current sales.

Did we see the increase described?

No! That would not change anything for the company’s bottom line would it?

When things got better, back came the bonuses in a different and better plan.

One company I worked for paid a special bonus for a special achievement. They paid well based on the savings or profits generated. That way usually the most creative people in positions that allow them to change things, such as engineers and supervisors, would get the special bonus. But not a few factory floor people got bonuses just by observing what was going on and suggesting a profitable idea.

I got a bonus right after I joined the company by saving them thousands of dollars in processing cost while reducing required production floor space. I was surprised to receive it. That is what I was paid to do. Engineers that worked for me got bonuses for special achievements that I expected them to do without any extra compensation.

I’m not against bonuses. I think they can raise moral and encourage workers to improve things. Gradual improvements can increase the productivity of a company and improve the quality of goods. Both results can mean more sales to the company. If a company can increase productivity using the same capital equipment, that is all gravy.

Employees need to realize that a benevolent company can have decreased profits and bonuses can’t be paid at times. I think the best thing for a company to do is to pay a bonus at intervals of less than a year.

A quarterly bonus could be better regulated in some companies and there would be less disappointment if a bonus was missed. If a small bonus was earned it could be added to any bonus generated the next quarter. That way the second bonus could be a little larger than normal and the employees would feel compensated.

Years ago a very large company wanted to hire me but they couldn’t match my salary. The reason was that a major part of the pay plan for the company was in bonuses. I could have taken the offer and done well financially, but I didn’t want to work for such a humongous company.

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