Incentives and Bonuses

*insert template* Attach video explaining how the company sets out incentive plans

*insert template* Attach video explaining how the company sets out bonus plans A bonus is non-guaranteed and usually on-the-spot

Specify exactly what earns a bonus and how much. Is it based on individual performance, team goals, company results, or some combination? Write it down clearly so there are no surprises. Vague criteria lead to disappointment and arguments. Include thresholds, caps, and timing.

Collect the metrics needed to calculate bonuses. Sales numbers, project completions, customer satisfaction scores, whatever your criteria require. Get the data from reliable sources and verify accuracy. Bonus disputes often come down to disagreements about the numbers.

Run the numbers according to your formula. Double-check the math - bonus errors are embarrassing and damage trust. Factor in proration for new hires or departures if applicable. Keep detailed calculations so you can explain exactly how you got each number.

Have the appropriate managers and finance review the bonus recommendations. They should verify amounts align with budget and policy. This is the checkpoint for catching errors or making adjustments before anything goes out. Document who approved what.

Send approved bonuses to payroll for processing. Communicate to each employee what they earned and why - the recognition matters as much as the money. Be ready to answer questions about how amounts were calculated. Process on schedule - late bonuses feel like broken promises.