My manager (with a history of reneging on bonuses) is offering a future bonus to make me stay. How can I make sure I'll actually get it?

Question

I work at a small family-office hedge fund and recently the last analyst quit making me the only remaining analyst. As such, the portfolio manager/partner immediately called me to discuss my compensation (we’ve talked about this in the past with no result). He called me and mentioned that he’ll be increasing my salary 40% starting January, and also told me the bonus I’ll be getting in March (usual bonus date) of 80%. I assume this was done to buy him time to find another analyst in case I was planning to leave.

That’s great and all... however he has a bad history of pushing out bonuses due to various excuses. Last year, my former colleague and I both didn’t get our bonuses (so she quit) and told me that he’ll give it in June due to the current environment. In June, he told me to wait until the end of the year when things get better with the firm.

Now, the only reason he brought up my bonus (historically I had to bring it up) is because he knows I’m the only analyst left and wants to make sure he doesn’t lose me at least in the near term (at least that is my assumption). While I don’t think the salary is going to be a problem as that will take effect in a month, the bonus is 4 months out and I believe there is a high chance if he were to hire someone else in the meantime, he could give me another excuse to push it out (although this is the first time he mentions a dollar amount).

I was actually going to quit at the end of January to continue working on a business I have started by myself. While not profitable right now, I managed to cut down most of my expenses and have savings that can last for a while. However, if the bonus is real then I would definitely like to quit post-bonus as that will add more cushion in my savings account. While January was the date I expected to have my target savings before I quit, the "promised" bonus I got on the call yesterday definitely makes things much more comfortable for me. Either way, I still plan to quit as soon as I get the bonus, or end of January (if I came to realize the bonus will not materialize).

How can I guarantee that I indeed will get this bonus payment, and that it’s not just used as a way to buy time to find another analyst?

Answer 1

tl;dr;

You can "test" how trustable this 2021 bonus is by requesting the immediate payment (before end of the year) of the 2020 bonus you actually never got. If employer says no => Start looking for a new job, your employer is not trustable and/or not financially stable, there's no good reason to assume it will become better. If your employer agrees and gives you a reasonable (up to you to set the threshold) bonus, you may want to trust them and wait another 3 months to see how things go. Worst case you're looking for a new job (that was already the plan), best case you can still look for a new job if you want, with that bonus money in your pocket anyway :-)

Long answer

The way you talk about your employer lets me think trust is already broken. Maybe you will get your raise (yet to be confirmed, even if it will be confirmed quite soon), maybe you will even get your bonus but it will anyway take years to get that that trust back so that you don't think your employer is "winning time" and making empty promises. So the obvious thing to advise would be to indeed continue/start the job search and leave when you can (assuming you can land an equivalent position)

That said, there might be a way to "test" your employer and if it goes well you could even get more money: what I would do in your case is requesting an immediate payment of your 2020 bonus that was initially promised for March 2020, then June 2020, then end of the year. Because guess what? We're end of the year :-) This bonus is linked to your 2019 performance, and while you've been patient enough (and I think in the current situation everybody has to show a little more patience and understanding), you still deserve it. The good thing is that apparently no amount was ever mentioned for this bonus, so it gives some space to your employer to decide on the amount NOW. Additionally with your colleague leaving the employer spares his bonus and salary money...

From the reaction to that request, you can probably have an idea how reliable the promise of your 2021 bonus is: if your employer can't afford to give you a bonus now or if he's being cheap, it would be safe to assume the situation won't change completely in the next three months and the 2021 bonus is an empty promise. It would also raise the question whether the company is financially stable and further concerns about your future: the salary raise seems fine, but if the company goes bankrupt in a few month, you'll still be in a worst situation than now (finding a job is easier when you already have a job, as paradoxal it may seem). So with a negative answer to your request, I would definitely start looking for a new job.

With a positive response and a reasonable amount, well, still you can't have any guarantee about your 2021 bonus but on that, situation stays equal: you still have to decide whether you can trust or not your employer, and look for anew job or wait and see. But the bonus money is in your pocket and it can't be taken away, that seems a good alternative.

Answer 2

It sounds like you have your PM over a barrel.

These are the terms I would demand to guarantee I actually get what was promised:

• The 2020 bonus gets paid immediately. Or as close to immediately as possible.

• The salary increase takes effect immediately, backdated to December 1st.

• The 80% Bonus gets paid In Advance, this month, with the provision that if you resign before March then you have to pay it all back. (Resign is important, because if it was just "leave" then they could fire you/push you out and demand it back).

And then stick your bonus in an account and don't touch it until April 1st.

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Given that you've said you're planning to quit anyway, I would suggest you give it your boss as an actual ultimatum, and as soon as possible. The sooner you do it, the less time they have to maybe find someone else, and the more desperate they'll be to keep you around.

Strike while you hold all the leverage, and squeeze them for everything you can.

Answer 3

Tell your boss that you require payment of past bonuses first. If they pay then leave anyway, the chances of them honouring the salary increase and future bonuses is too low.

Just be sure to phrase it as "I'd need the March bonus to be paid first before I can consider this offer" so you are not committed to staying.

The only way you should even consider staying is if the pay rise is immediate (this month, not January) and the 2021 bonus is paid now as a show of good faith. Do not allow your boss to take advantage of your trust, however weak it might be.

Answer 4

What are your suggestions to guarantee that I indeed will get this bonus payment and it’s not just used as a way to buy time to find another analyst? Thanks.

Take it for what it is. Until you receive a raise or bonus, they're empty words to try and keep you around. It's up to you if you move on.

If the pay rise and bonus are the difference between you staying and leaving, the only way to guarantee it is by a contract.

A short contract that says, if you stay until x date, your salary will be increased to x amount, and you will receive x amount bonus paid within x period of time. If you are terminated before x date you will receive x amount in addition to any other severance pay etc...

However, getting a contract like this is very unlikely to happen, and probably more trouble than it's worth.

Sounds like past bosses I've worked for, and there's always an excuse. My last boss replaced pay rises with bonuses because it gives them a way out of paying.

As it's very clear this is only to keep you around, as you're the last person, as soon as they hire someone else the incentive to pay you the bonus has gone.

offering a future bonus to make me stay - How can I make sure I'll actually get it?

I'd be looking for another job. Do you really want to work for someone you cant trust to pay you what they've promised?

Answer 5

Start your job search.

Even your past relationship doesn't guarantee you will receive the bonus in future.

Any future commitment without any written commitment is of no use.

Even in the written commitment, certainly they will include other conditions like individual/company performance so that if in case they want to deny the bonus later, then they would use that parameter.

Answer 6

UPDATE: Talked to my boss and asked for a portion to be paid out now (as a form of payment for 2019) and the remaining portion to be paid out in March (for 2020). He asked me if it was alright to get it paid out end of February a long with everyone else in the Company. I did say I am ok with it (I know some of you will get angry at that) but I asked for a written confirmation stating my bonus and salary increase. He gave me a confirmation with the exact date of the salary increase (starting 1/1/21) and the bonus (end of Feb). He then asked if I'm looking to change jobs and said he'd be willing to help but he would prefer I stay given a strong 2021 outlook and asked me to let him know. I told him I was considering leaving and that I talked to a couple of companies based on the fact that my future compensation was unknown but given his written confirmation and call, I'll end all conversations. From the sound of it, It looks like this time could be different as he was the one to bring up the offer, I am the only analyst remaining, and this is the first time he mentions an exact amount and date. He was also very happy to hear I'm staying and thanked me for my confidence in him and the firm. So I guess time will tell (2 months period).

Answer 7

Not much of the options out there, even getting a postdated cheque can not guarantee it will clear.

Glassdoor and such are your best friends now In the case of getting the boss`s behavior out in the open may deter candidates

Answer 8

Either way, I still plan to quit as soon as I get the bonus, or end of January (if I came to realize the bonus will not materialize)

I plan to quit and work on a business i've been working on that requires time.

Since your mind is made up about quitting I don't see anything wrong with being honest with your soon to be ex-boss, explain to them that you are almost out of the door too, maybe bring your notice with you to the conversation and that if they need you for few extra months then it's going to cost them X$ per month extra compared to your current salary, and that there is no hope of retaining you past that period.

This puts you exactly in the same situation you are now where you will likely not see that bonus money anyway (clearly you do not trust the boss to delivery on it and expect to just dangle it like an unreachable carrot), and if they value you enough to pay the premium for few months while they look for replacement(s) they can decide to do so - and you will actually get it paid right away as extra with each paycheck which tends to have much better protections in law than a promise of a bonus (aka if they don't pay it, you will likely have MUCH easier time collecting it).

And if they decide that you are not worth retaining at a premium rate then by end of January you quit like planned, with the same amount of money you would have had anyway as they very likely were not going to pay anyway.

Answer 9

Despite the plethora of answer, there is a simple way of making sure your manager pays you the bonus he says he will that nobody has mentioned.

Get him to state that you will get the bonus, and the raise, formally in writing.

Make sure that the statement is not hedged with things like "subject to approval" or "consideration" or "depending on XYZ". Have him sign it. Then you write him a latter stating the terms again and that you accept them. You might consider running the letter by a lawyer, but in general him making an offer like that, and you accepting it, should constitute a contract which can be enforced legally.

In any civilized country such an offer constitutes terms of employment which they cannot undo without serious repercussions. In the United States of course such an offer can be undone without any repercussions, but then your entire employment can be rescinded at any time, so you are no worse off.

Answer 10

What are your suggestions to guarantee that I indeed will get this bonus payment and it’s not just used as a way to buy time to find another analyst? Thanks.

There is no way to guarantee that you will receive a bonus payment. It is completely out of your hands. Even if you miraculously receive a bonus, there is no way to guarantee that it is not just used to buy time to find a new analyst.

You mentioned:

he told me to wait until the end of the year when things get better with the firm

This is a typical excuse for not paying bonuses or salary increases. Whether it is a valid reason or not is irrelevant. Your previous bonus has already been "pushed back" multiple times already. You will likely never see them.

Start looking for a new company to work for. At best, your current company is financially unstable and at worst your boss is a cheapskate.

Answer 11

What do you mean by this?

I was actually going to quit at the end of January

Do you have another job lined up? It's not very wise to just leave a place of employment without a plan.

Overall, is the job satisfactory aside from not receiving a bonus? I've never had a job where a bonus is expected but I'm just a web developer so it might be different in your industry.

Is the bonus something you need desperately to afford rent? Is there a defined criteria which you've met to actually receive a bonus?

It really sounds like your boss is holding a carrot on a stick.

I would start job hunting now. This way you can have something lined up and comfortably quit if things don't go well. If things do go well then simply stop job hunting.

Answer 12

It's unclear from your question as to whether or not you got paid last year's bonus (which your coworker quit over) yet. They said "end of the year", well today is December 4th, that's pretty darned close to the end of the year so you should be asking about that.

Here's where I'd start: First, you push for your last-year's bonus to be paid immediately. I'd phrase it something like this:

Hey Joe, we spoke the other day about you wanting to retain me at this company, and how you want to give me a nice bonus in March for staying with the company until you can find Alice's replacement. However, I still have not yet received my 2019 bonus which was promised by the end of 2020. Today is December 4th, which is pretty close to the end of the year, so I'd like to know if my bonus from 2019 is coming promptly.

See how he responds to this. If he pays immediately, then you can move on to the next step. If not, then start searching for a job immediately. If you need any rationale for why to do this, the least rationale you can use is that, if he hasn't paid you your 2019 bonus by March, then even if he pays you a bonus in March, it will be your 2019 bonus and not the bonus he's promising you now; he's trying to double-dip by promising you the same bonus you've already been promised, and you're not actually being rewarded for loyalty. Of course, there's also the rationale that the company is having financial problems, is a sinking ship, management has lied to you for a year, and so on.

Now, if he does pay you your 2019 bonus, you should throw it back in his face, as follows:

Hey, Joe. I received my 2019 bonus, thanks for that, I really appreciate it. Now, on the topic of the bonus you promised me in March, I'm a bit concerned. My 2019 bonus was promised to me, and then it was delayed twice, for almost a whole year. I'll promise to stay with the company at least until March so you can find a replacement for Alice, but what guarantee do I have that the same situation won't happen again, and you'll delay that bonus until June and then December afterwards?

See what he says to that. He needs to give you something in writing, that you can present in court in case he renegs again. Anything short of that means he is intending to reneg on this commitment again, and you should ignore this promise of a bonus, at least you should ignore that the bonus is coming anytime soon, and you should search for a new job.

If he commits in legally-enforceable writing to give you a bonus in March, then you work until the first payday of January and see if his promise of a 40% raise is true (be aware your net income might not raise by 40% because taxes so account for that). If it's not, then you have some math to do: You can sue the company for an 80% bonus (because you have it in legally enforceable writing as per above). However, you're going to lose 3 months of the difference in pay between your current position and a hypothetical new job between now and then. Does that math work? If the math doesn't work, then search for a new job immediately; if it does work then continue working until March to collect your bonus (or so that you can collect legal grounds to sue for it, as the case may be). In either case, if you fail to receive the raise as promised, then as soon as you collect the bonus in March, start looking for a new job.

The only way you should continue working at this company past March is if the following 3 things are all true:

1. You get paid your 2019 bonus before December 31 (27 days from today)
2. You get your promised 40% pay raise in January, and that continues to be honoured going forward (if you ever get a pay cut following this raise, get out immediately)
3. You get paid your 80% bonus by March 31 2021 without incident (that part is important, if you have to remind them or beg them or whatever, that's a good enough reason to quit in March imo)

If any of those 3 things turn out to be untrue, search for a new job.

As a side note, I'm not sure if this is you, but a trap others commonly fall into is they are afraid of their company failing if they leave. Definitely DO NOT DO THAT. It's not your problem, you're not being paid enough to care about whether or not you are of critical value to the company. It's your boss's job to care about that, and to do whatever it takes to retain you if he believes your leaving to be a critical risk to the company; it's your job to look out for number 1 and do whatever is in your own best interests, even if that means the company dies. As long as your boss keeps you happy, then stay; if that doesn't happen, then find a boss that will.

Answer 13

First of all, hand in your notice now. All of the action is coming from their side and you're just sitting there and taking it.

coming to you and talking about bonuses and payrises without actually giving them to you is hot air. I've had half a dozen manager/company owners like this and they think they're some kind of hot shit negotiator, and will pat themselves on the back for "keeping personnel costs down", even if they don't really need to, while spending thousands on stupid crap like taking clients for dinner or whatever. They know that you won't speak up, won't do anything dramatic, will be able to be pushed around because you have allowed that to happen up until now.

So man up, grab a pen and start writing.

You're handing in your notice owing to non-payment of your promised annual bonus for 2020. You were told you would get it in June, then you were told you'd get it at the end of the year, and now you're pretty certain that you're not going to be paid it at all this year as they've started talking about the 2021 bonus without mentioning the 2020 one.

That's not good enough, and is more than enough grounds to quit (which your colleagues seem to realise more than you do).

All these people saying you have to start coming up with demands and contracts and getting them to put stuff in writing are dumb. That is not how it works. Certainly not with a small, family-run, hedge-fund type financial business like this one. They won't ever agree to anything like that.

No. You hand in your notice. Then you wait.

Once they see you're not a pushover any more, they will come to you. They'll pay you the bonus you're already due, and action your salary increase effective from next month.

They will also think twice next year when it comes to bonus time about simply trying to not pay you it and seeing what happens, which sounds like is what happened this year, with the convenient excuse of "oh well Corona" that every CEO and small business owner is using this year to justify their greedy decisions.

It's possible that they accept your notice and just let you leave. In which case, Sayonara. You're better off out of there anyway. But from what you've said that seems unlikely.

If you really are the only person in the role right now I'd suggest it's time to stand up for what you're owed, and sadly the only leverage any of us ever has at work is our resignation letter.