Job Offer – bonus details provided after acceptance

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DarkHelmetII
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Job Offer – bonus details provided after acceptance

Post by DarkHelmetII » Tue Oct 16, 2018 7:38 am

Gainfully employed but have a job offer to join a new firm. Negligible (2 – 3%) increase in base but new target bonus is 55% of base whereas current target bonus is 20% of base.

Prospective employer sketchy on details for how this significant bonus is determined and offer letter says details will be provided upon accepting the offer. Am I crazy for being a little skeptical here? Past two bonuses with current employer have been paid a little more than target plus employer has been throwing some additional retention bonus money at me for good work.

I gave the prospective new employer a base number (one which I consider to be high enough to compensate for the uncertainty of the bonus payout) which they have not matched. Leaning toward declining the offer but looking for a sanity check on my perception of the bonus … just seems like I am lacking in details around a material portion of the total cash compensation.

Have I left out other aspects such as quality of life, commute, health insurance....? Yes. These are roughly equal. My big hangup right now is on this bonus so have focused on that. Though being a BH have to mention new job 401k supports mega back door whereas current does not ... but I still don't think that should be driving the decision.

Soon2BXProgrammer
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Re: Job Offer – bonus details provided after acceptance

Post by Soon2BXProgrammer » Tue Oct 16, 2018 7:41 am

DarkHelmetII wrote:
Tue Oct 16, 2018 7:38 am
Gainfully employed but have a job offer to join a new firm. Negligible (2 – 3%) increase in base but new target bonus is 55% of base whereas current target bonus is 20% of base.

Prospective employer sketchy on details for how this significant bonus is determined and offer letter says details will be provided upon accepting the offer. Am I crazy for being a little skeptical here? Past two bonuses with current employer have been paid a little more than target plus employer has been throwing some additional retention bonus money at me for good work.

I gave the prospective new employer a base number (one which I consider to be high enough to compensate for the uncertainty of the bonus payout) which they have not matched. Leaning toward declining the offer but looking for a sanity check on my perception of the bonus … just seems like I am lacking in details around a material portion of the total cash compensation.

Have I left out other aspects such as quality of life, commute, health insurance....? Yes. These are roughly equal. My big hangup right now is on this bonus so have focused on that. Though being a BH have to mention new job 401k supports mega back door whereas current does not ... but I still don't think that should be driving the decision.

Not saying you should, but we have people back out of hiring between accepting and their start date. (they never gave notice to their current employer). i'm not sure why they won't share some of the details about how the bonus if calculated.

DarkHelmetII
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Re: Job Offer – bonus details provided after acceptance

Post by DarkHelmetII » Tue Oct 16, 2018 7:49 am

Soon2BXProgrammer wrote:
Tue Oct 16, 2018 7:41 am
i'm not sure why they won't share some of the details about how the bonus if calculated.
I've gotten tidbits of it verbally but recruiter (internal HR) keeps alluding that it's basically in the "head" right now of my would-be boss's boss. That plus the bonus structure is changing going into 2019. So think it's a case that nobody knows exactly what it's going to look like (as opposed to an intentional hiding of the facts) ... but still something doesn't feel right to me.

jhwkr542
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Re: Job Offer – bonus details provided after acceptance

Post by jhwkr542 » Tue Oct 16, 2018 7:50 am

The lack of details of the bonus is a red flag to me. No acceptance (as meaningless as it may be) until they divulge the details. It doesn't mean you have to completely back out. Just keep pressing them and say you won't accept until you know what it'll be.

edge
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Re: Job Offer – bonus details provided after acceptance

Post by edge » Tue Oct 16, 2018 7:55 am

Get it in your offer or walk.

magicrat
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Re: Job Offer – bonus details provided after acceptance

Post by magicrat » Tue Oct 16, 2018 7:56 am

DarkHelmetII wrote:
Tue Oct 16, 2018 7:49 am
Soon2BXProgrammer wrote:
Tue Oct 16, 2018 7:41 am
i'm not sure why they won't share some of the details about how the bonus if calculated.
I've gotten tidbits of it verbally but recruiter (internal HR) keeps alluding that it's basically in the "head" right now of my would-be boss's boss. That plus the bonus structure is changing going into 2019. So think it's a case that nobody knows exactly what it's going to look like (as opposed to an intentional hiding of the facts) ... but still something doesn't feel right to me.
If it were me I'd tell them I'm very excited about the offer, but am unable to evaluate it fully until they provide the details of the bonus plan.

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oldcomputerguy
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Re: Job Offer – bonus details provided after acceptance

Post by oldcomputerguy » Tue Oct 16, 2018 7:56 am

DarkHelmetII wrote:
Tue Oct 16, 2018 7:38 am
Prospective employer sketchy on details for how this significant bonus is determined and offer letter says details will be provided upon accepting the offer.
Given that there is no other significant improvement in your situation from the move, if it were me I would decline. The fact that they're holding disclosure of all the elements of your total compensation until you're committed seems to me very fishy. It seems to me that you're leaving an established position for one that only pays marginally better (other than the "phantom" bonus). Given that you're banking your income and your family's welfare (assuming arguendo that there are other persons in the picture) on this move, I'd say stay put.
I've gotten tidbits of it verbally but recruiter (internal HR) keeps alluding that it's basically in the "head" right now of my would-be boss's boss.
This is a huge, huge red flag. This needs to be set down in black and white. Run away.
It’s taken me a lot of years, but I’ve come around to this: If you’re dumb, surround yourself with smart people. And if you’re smart, surround yourself with smart people who disagree with you.

setancre
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Re: Job Offer – bonus details provided after acceptance

Post by setancre » Tue Oct 16, 2018 8:04 am

Ask for your first year's bonus to be guaranteed at $x and see what the response is.

carolinaman
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Re: Job Offer – bonus details provided after acceptance

Post by carolinaman » Tue Oct 16, 2018 8:05 am

Not providing details about how bonus is calculated and the bonus is targeted at 55% of base. That is a big red flag, especially since the base is only a slight increase. If I were you, I would insist on more details or walk. In fact, their reluctance to provide details is a red flag even if they subsequently provide it. It tells you this company is very opaque and probably not employee friendly.

Soon2BXProgrammer
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Re: Job Offer – bonus details provided after acceptance

Post by Soon2BXProgrammer » Tue Oct 16, 2018 8:08 am

i gave this a second thought. if they don't know how the bonus will work, ask them to convert as much as they can to base, and present a new offer. this might actually turn out to be a great win for you with guaranteed money.

DarkHelmetII
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Re: Job Offer – bonus details provided after acceptance

Post by DarkHelmetII » Tue Oct 16, 2018 8:19 am

All - this is super helpful feedback. To recap here are four actions I am hearing (not necessarily in any particular order):

1) Get more details in writing in offer letter on bonus calculation
2) Walk
3) Have them guarantee first year's bonus
4) Convert as much as possible to base

I love #4. Anyway, still chewing on all this (and any subsequent feedback) and will see how things unfold in next 24 - 48 hours.

viz
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Re: Job Offer – bonus details provided after acceptance

Post by viz » Tue Oct 16, 2018 8:41 am

Based on the details, I would decline unless you want to leave the current job or are truly excited about the work at the new one. I would ask for the following:
1. Bonus details on paper
2. First year bonus upfront. It can be contingent to you being in the company for a year

I can guarantee that the moment they put the bonus of paper, it will come with caveats like it is not guaranteed, based on company performance, your performance, blah.. blah.

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TxAg
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Re: Job Offer – bonus details provided after acceptance

Post by TxAg » Tue Oct 16, 2018 8:55 am

Red flag

JuniorBH
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Re: Job Offer – bonus details provided after acceptance

Post by JuniorBH » Tue Oct 16, 2018 9:14 am

I would push to get more details, it's perfectly reasonable to understand your complete compensation picture before signing up. And I would want it in writing if you suspect things are going to change; as someone else suggested, might be a good reason to push to have the first year guaranteed.

As an aside, this is the second thread in a row I've read where people suggest the OP "walk away" from a situation when the details aren't 100% clear. I get the concept of wasting time, but why are people so quick to completely move on from something when the details are still murky?

Jack FFR1846
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Re: Job Offer – bonus details provided after acceptance

Post by Jack FFR1846 » Tue Oct 16, 2018 9:28 am

Sounds like they manipulate the bonuses based on how much money they have to spend on people in the position you would take. So if one guy hits it out of the park and warrants all of the available bonus money, the boss' boss makes up numbers, shuffles accounts before the end of the bonus earning period and everyone gets shafted. "Up to 55%" includes zero. My own company for last quarter made some huge screw ups at the executive level that's tanked the stock and thrown our near future in jeopardy. The fix for all this screwing up by the executives? 1 company wide quarterly bonus: $zero. One bonus for sales and field: $zero.
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flossy21
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Re: Job Offer – bonus details provided after acceptance

Post by flossy21 » Tue Oct 16, 2018 9:35 am

You should ask for a one on one call with the "boss' boss". In that call you should lay your cards on the table to him/her. Basically say that you are flattered by the offer but, given the minimal increase to base, the decision hinges on your ability to achieve bonus. Ask him/her to outline the things that you need to achieve in order to see the bonus at 55%.

If the "boss' boss" can't define these goals specifically then you have to decide but it is a big red flag.

Novajen
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Re: Job Offer – bonus details provided after acceptance

Post by Novajen » Tue Oct 16, 2018 9:36 am

Regarding the bonus, when do you usually get it? I'm in banking and we get bonuses during 1st Q. When I was switching companies last fall, my offer with the new bank included a sign-on bonus since I wouldn't be getting my usual bonus from former bank. Just another thought for you to consider.

DarkHelmetII
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Re: Job Offer – bonus details provided after acceptance

Post by DarkHelmetII » Tue Oct 16, 2018 9:46 am

Novajen wrote:
Tue Oct 16, 2018 9:36 am
Regarding the bonus, when do you usually get it? I'm in banking and we get bonuses during 1st Q. When I was switching companies last fall, my offer with the new bank included a sign-on bonus since I wouldn't be getting my usual bonus from former bank. Just another thought for you to consider.
Current company bonus paid out in Q1 (typical). Sign-on bonus will cover only about 50% of what I'd be leaving on the table (I left out these details previously just to not over-complicate all of the particulars, though contemplated that in the base number I requested but was not matched). At new company, interestingly, bonus is paid out monthly. That invokes further head scratching in that, how do you on a monthly basis, calculate profitability, revenues etc....?

Thanks again all for your inputs.

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8foot7
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Re: Job Offer – bonus details provided after acceptance

Post by 8foot7 » Tue Oct 16, 2018 9:47 am

There are only three legit ways to play this:

1) demand a guaranteed year-one payout at 50%. It's understandable they might be rejiggering their comp system and you're willing to subject yourself to the whims of their system in year 2 but in year one you want the guaranteed bonus and you're willing to come down a little on the 55.
2) demand a signing bonus equal to the bonus you're leaving so that if you get shafted in the new company you have something to fall back on
3) tell them you can't accept until you know the full details of the bonus, including a firm target and estimated date of payout

Tal-
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Re: Job Offer – bonus details provided after acceptance

Post by Tal- » Tue Oct 16, 2018 9:47 am

I agree that this is a big red flag!

Incentive programs typically have a target and a maximum. Without a more detailed description, you can't know if the 55% is the target or the maximum. And, even if you knew that the 55% was the target, who knows how ambitious or achievable that is. That is to say, without additional info, I wouldn't call the new incentive any more rich than your current incentive.

With that said, I would ask for a written description of either plan details (unlikely to provide) or past payouts amounts (much more likely to provide). Seeing what previous incumbents in like positions have earned will provide a lot of insight into future payouts. That is, if the plan wasn't getting turned on its head in 2019 (no idea how to control for this).

What I wouldn't do is demand that the bonus be paid upfront. In my world (big corp), that simply isn't done.
Debt is to personal finance as a knife is to cooking.

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8foot7
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Re: Job Offer – bonus details provided after acceptance

Post by 8foot7 » Tue Oct 16, 2018 9:49 am

Jack FFR1846 wrote:
Tue Oct 16, 2018 9:28 am
Sounds like they manipulate the bonuses based on how much money they have to spend on people in the position you would take. So if one guy hits it out of the park and warrants all of the available bonus money, the boss' boss makes up numbers, shuffles accounts before the end of the bonus earning period and everyone gets shafted. "Up to 55%" includes zero. My own company for last quarter made some huge screw ups at the executive level that's tanked the stock and thrown our near future in jeopardy. The fix for all this screwing up by the executives? 1 company wide quarterly bonus: $zero. One bonus for sales and field: $zero.
This. Plus as the new guy you're probably not going to leave enough of a mark to beat out the superstar, at least in the first year, so you know you're going to get hosed unless you've got something in writing.

Mr.BB
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Re: Job Offer – bonus details provided after acceptance

Post by Mr.BB » Tue Oct 16, 2018 9:52 am

When someone cannot give you a straight answer ...run away.
You may not love what you currently have, but you know what you got.
Number 1 rule of basic information...If a person cannot answer why or how they either don't know the answer or they do not have your best interest in mind.
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Grt2bOutdoors
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Re: Job Offer – bonus details provided after acceptance

Post by Grt2bOutdoors » Tue Oct 16, 2018 9:59 am

Red flag. They could be moving to a “pot” structure. One big pot to divvy up at their discretion. Those are amongst the worst in bonus pools because of the level of subjectiveness. Your performance may or may not have anything to do with actual payout.
Last edited by Grt2bOutdoors on Tue Oct 16, 2018 8:25 pm, edited 1 time in total.
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michaeljc70
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Re: Job Offer – bonus details provided after acceptance

Post by michaeljc70 » Tue Oct 16, 2018 10:18 am

I agree that knowing how it is calculated would be useful. However, that still won't make it guaranteed. I would ask what % of years do people in your role (or a similar role) get their targeted bonus and what the average % of the targeted bonus has actually been paid in the past. Bonuses can be tied to so many different things, many of which can be out of your control. At least where you are now you have a pretty good idea what your bonus is going to be.

staythecourse
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Re: Job Offer – bonus details provided after acceptance

Post by staythecourse » Tue Oct 16, 2018 11:07 am

You only have 3 options:
1. Say yes to the offer, get the bonus structure then join.
2. Say yes to the offer, get the bonus structure then say no based on new information that changed your decision. Totally reasonable as they are unwilling to let you know in advance.
3. Say no now as they aren't giving you enough information to make an informed career decision.

Whatever you do, do NOT let your current employer know until you are full satisfied in your CONTRACT on all the parameters.

Good luck.
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missingdonut
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Re: Job Offer – bonus details provided after acceptance

Post by missingdonut » Tue Oct 16, 2018 11:29 am

magicrat wrote:
Tue Oct 16, 2018 7:56 am
If it were me I'd tell them I'm very excited about the offer, but am unable to evaluate it fully until they provide the details of the bonus plan.
Pretty much. At this point, the value of the bonus in the job offer is about $0.

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cheese_breath
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Re: Job Offer – bonus details provided after acceptance

Post by cheese_breath » Tue Oct 16, 2018 11:38 am

DarkHelmetII wrote:
Tue Oct 16, 2018 7:38 am
Gainfully employed but have a job offer to join a new firm. Negligible (2 – 3%) increase in base but new target bonus is 55% of base whereas current target bonus is 20% of base.

Prospective employer sketchy on details for how this significant bonus is determined and offer letter says details will be provided upon accepting the offer....
This is as far as I had to read. What if instead of this they said health insurance details will be provided upon accepting the offer? Would you accept it?

I wouldn't.
The surest way to know the future is when it becomes the past.

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