Year End Bonuses?

PipeGuy

I'd be interested in knowing what others do in terms of distributing year end bonuses. Is the 'year end' or 'holiday season' too arbitrary a reason to distribute a bonus. I'd prefer to distribute bonuses throughout the year, in close proximity to measurable accomplishments like job completions, succesful final inspections, , progress billings, etc., rather than just issue a bonus because of a date on the calendar. What say you?

__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

Mike Finley

Your employees would probably feel a bit different. Christmas is the perfect time to pay a bonus, its the season of giving you know. Keep in mind that long term employees will begin to look at year end bonuses as part of their compensation. So doing it this year and not next year will be looked at as a pay cut.

Floorwizard

We get bonuses based on profit margin from stuff we sell. It usually ends up being towards the end of the year.

__________________
------------------------
"in 20 years you will regret more what you did not do than what you did"

Glasshousebltr

Dock em all, only real work reflects possitive in pay. Whens the last time a customer gave us something for christmas other than last years fruit cake.

Bob

Floorwizard

I actually got an Ethan Allen dresser from a client last year.
Super rich people....very nice.

__________________
------------------------
"in 20 years you will regret more what you did not do than what you did"

Teetorbilt

Sept. 5th Francis hit and employee recovery moved to the forefront. Sept. 25th Jeanne hit and the process was repeated. Oct. was like working in a war zone and most people could not pay for one reason or another. Help thy neighbor. Virtually all of my 'cushion' resources were used up. I sold many personal items at discount just to make ends meet.
Yes, I have ins. but with over 1M claims these folks are really busy too. Add to that another ton of paperwork, anybody else ever deal with FEMA? Think that taxes are hard? That's just the beginning with these folks. In the future I'm going to tell them that I failed 3rd grade and was a sidewalk performer until I was 30. They do everything if you're ignorant, uneducated and stupid. Unfortunately for me, I was only ignorant.
The ins. checks started rolling in last month and I picked a few 'cherry' jobs to get the cash flow back in action. The checks from those jobs have just been deposited and the Christmas bonuses will be flowing. I'll be near flat again but you have to take care of the ones that take care of you.
I think that I just wrote one of those life statements or it's something that I swiped from a seminar many years ago. LOL
BTW Nobody is expecting anything. I'm also pretty open with the guys when it comes to how well we're doing and we were on the way to a goose egg last quarter in a bad quarter (most people don't remodel during the holidays) plus the outlay of fixing their homes. I didn't paint a rosey picture on bonuses.

hatchet

If you're interested in giving bonuses year round - setup one jobsite with a percentage of the contract price as a safety bonus. Maybe .5% or something - really depends on the contract price. Anyway - if the job doesn't have any lost time accidents, or doctors cases then the pool gets distributed among the employees that worked on that job. One of our steel erectors does it - and the employee really seem to like it.

__________________
Rich
WIT Construction Co.
Superior MT Contractor

Grumpy

I have an online bud who puts aside a percentage of profit each year. At the end of the year he distributes that profit that he put aside. He has an advanced spread sheet based on years with the company, attendance, disciplinary actions, you name it.

I think year end bonuses are the way to go... but I also think bonusing through out the year for productivity is also a good thing.

hatchet

Here's another way to look at it if you base it on company wide profits - if one job loses money is it fair to the jobs that made money to get their amounts reduced? You should be rewarding the jobs that make money right?
As an aside - the company I work for does it company wide instead of per project A lot of us disagree with that - but still happy that we get anything at all.

__________________
Rich
WIT Construction Co.
Superior MT Contractor

PipeGuy

It depends...
I think bonuses should serve to reinforce the bonusee's desire to accomplish what the bonuser wants to get done - in the strongest way possible. I also think the bonuser needs to take into account what it is the bonusee has control over. I think it's counterproductive to tie bonuses to criteria that a bonusee can't affect in a practical and direct way.
For instance, does my backhoe operator have control over company wide profits? The answer is clearly, no. If you ask the same question about the estimator then the answer begins to get less clear. In my mind, a bonus based on company wide criteria is one that serves, primarily, to promote teamwork. After all, is there really a single individual that has control over that result?
Some of the things my back hoe operator has control over include: his work attitude; the condition of the backhoe; the extent to which things that he digs around do, or do not, get damaged; the safety of workers in the trench, etc. Some of the things the estimator has control over are accuracy of cost estimates; frequency of awards; timeliness of bid submissions; volume of estimates submitted, etc.
I'm not sure what it is that a "seasonal" bonus promotes - respect for humanity?

__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

Teetorbilt

I think that the nice thing about a lump sum is that it doesn't get used for day to day expenses or worse (partying). It also ensures the ability to have an enjoyable holiday season without breaking the bank or going into debt.

trekr

Teetor, I agree. The holiday bonus can be be a nice stress reliever. The only downside is that this bonus becomes an expectation..

PipeGuy

OK - everybody together now...


How is it that so many can recognize this very real downside yet not choose a different course of action? In terms of long term benefit to the company does a Christmas (yes CHRISTmas, not X-mas or CMas or holiday) bonus 'hurt', is it benefit neutral or does it promote the company's interests?

__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

trekr

I think it is still a benefit to the company. Even though it may be an expectation, it is still appreciated at this time of year. I do not think that this should be the only bonus paid for the year. A larger portion of money should be tied to performance metrics throughout the year. Also, re the holiday bonus, since it is usually expected, any deviation from the norm should be communicated well in advance. In other words, rough year/no bonus should be conveyed asap.

Teetorbilt

Many years ago I attended management seminars staged by a very large international corp (think IBM, GM size). We were taught that a good manager does their best to remove obstacles that prevent others from doing their jobs. Financial problems are a large obstacle for many families. If Joe Bagodoughnuts spends his working time trying to figure out how he is going to make all of his normal expenses AND pay for the holidays he is not going to be giving you 100%. He may take up moonlighting to make ends meet, lack of rest means you are not getting that 100% again. If he goes into debt by stacking everything on his CC it may be months before he recovers and in the end it costs YOU in lost efficiency and mistakes.
Moral is another issue and knowing that you are getting some extra cash at the end of the year tends to keep that high as well.

PipeGuy

Thanks for all the great input on this matter. It helped to bring some things into focus for me.
After some discussion my partner and I decided that, for us, the 'goodwill' aspect of giving a Christmas bonus is enough reason to do it - and it's actually our pleasure and good fortune to be in a position to pay a bonus to the exceptional bunch of guys we've been able to bring together during our first full year ('04) in business. We settled on 'a week's pay' as the right figure.

__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

Teetorbilt

That's a nice bonus for your first year. I paid $75 for each month worked and am shooting for $100 next year if health ins. doesn't go up too much.

TimWieneke

In our weather climate, Christmas bonuses are very nice as work slows right around Christmas and a lot of guys are sitting at home. You couple that with winter's increased living expenses for heat, cars, etc... The bonus really helps take the edge off.

If you have a good accountant who keeps you updated on your company's financial progress for that year you can tie bonuses to profitability.

Tim

__________________
As Steve the Foreman would say, "Forgive him Lord, for he doesn't know what he's doing."