That Bonus discussion is coming.....

Bonus time can be a very stressful time. Is it a debatable issue? You bet! One thing is certain it encourages employees to perform better.

There is talk about merits of annual bonus vs smaller payouts right through the year. Should a performing employee wait till end of year to be rewarded? Annual bonuses focus on year-end results but most employees do not have influence on this as their jobs are far removed from the results centre eg accounts & admin personnel. Should employers focus on the behavoural attitude, committment, loyalty and values shown by employees during the course of the year. Eric Mosley, author of "You're Getting a Bonus! So Why Aren't You Motivated? Suggests smaller payouts throughout the year tied specifically to outcomes you value when they happen. This also does justice to those employees who leave before year-end.

A bonus should be relationship builder with your direct boss instead of a cheque transaction from some bean counter in the payroll department somewhere in the building.

Are financial rewards detrimental to morale?

There is a new thinking that financial rewards can be detrimental to morale; jealousy and competition can arise, damaging team dynamics according to Lalin Anik and Jordi Quoidbach in his book, “The Bonus Employees Really Want, Even If They Don’t Know It Ye,” The author suggests switching to a more altruistic program, in which you provide employees the same bonuses with one caveat: A portion must be spent on "prosocial" contributions that benefit others, like charities.

Navigating the Bonus Jungle

1. Avoid pitfalls! Don’t make up your own stuff. Follow company policy.

2. Awards must be based on accomplishments not looks.

3. Bonuses can only be meaningful if they are motivating otherwise the whole exercise could be very damaging to team morale.

4. Transparency – it should be clear on what needs to be achieved to earn a bonus. This should be delivered with utmost caution.

5. Convey gratitude when dishing out the cheques. Be meaningful and specific in your feedback even if it’s the employee you can’t wait to leave.

6. Show courtesy. Don’t dumb the bonus cheque/letter on the employee’s desk when they are out for lunch/tea break. It’s impolite.