When we think of bonuses, we often think of end of year, maybe Christmas. But bonuses can come at any time and in forms other than cash.
For example, bonuses can be given for a job well done at the completion of a project and the bonus doesn’t have to be cash either.
- Gift cards
- Travel vouchers
- Stock options.
While cash is usually the most sought after option, many employees realize that cash is taxed. If they’re planning to use the bonus for savings or entertainment anyway then other options might be better.
Non-cash bonuses are not just good for the employee but employers can usually get gift and travel vouchers at a reduced bulk rate. This helps employers save money on bonuses so they can give out more of them.
Company Wide Bonus Schemes
Bonuses can be given company-wide and at specific intervals. Examples of this are:
- Profit sharing
- Holiday bonuses
- End of year bonuses
Performance Bonus Schemes
Most bonuses are given on an performance basis to an individual or team. Some of these include:
- Individual incentive
- Team incentive
- Achievement awards
- Sales commissions
- Milestone bonuses
- Sign on bonus
How Bonuses Are Measured
How a performance based bonus is measured varies and is very important to consider. Some bonuses such as sales incentives are figured based on some pre-set criteria such as a sales quota. Other bonuses are called discretionary bonuses. These are bonuses paid at the discretion of the employer, or any time the employer sees fit. In an employment contract, an employer will need to stipulate the type of bonus offered to the employee so as to protect himself from misinterpretation.
The Timesheets online employee management software offers expense and HR tracking which can be used to track bonuses. We would love to show you how this works. For more information, take a look at this article: Keeping track of bonuses and give us a call for a free demo.
More Resources About Bonuses:
Employee Bonuses and Your New Job at Labor Employment Law
Types of Bonuses at Salary.com
Bonus Schemes at Love2Reward.com