Fair Bonuses

The fair bonuses are a very common topic in many companies. The employees want to understand, how their personal bonus was calculated and how it is related to the bonus of other employees. Not just in their own department or unit, but they would like to understand to the bonus scheme for the whole organization.

The bonus scheme should be unified in the main bonus principles for the whole company and the different units have to be forced to use the same principles. The employees in different units should have the chance to reach the same bonus. It is quite common, that many employees do not believe the chances for the fair bonus are equal.

The only way to implement the fair bonuses in the organization is about the consistent goal setting process and the fair evaluation of the KPIs in the organization. The employees have to trust, the managers use the measures and the best employees are comparable across the whole organization.

The fair goal setting process is very difficult and it needs a lot of the effort from Human Resources and the top management as the managers know, that cheating the goal setting process can bring huge financial benefits for their units. The employees will feel their managers as strong and valued in the organization.

When the fair goal setting process is not implemented yet, the top management has to play the important role for the fair distribution of the bonuses among different units. The top management has to evaluate the contribution to the final results of the organization and it has to set clear rules for the distribution of funds among employees. Human Resources has to be responsible for the monitoring of the distribution and it has to report the potential issues and breaches of the bonus policy set by the top management.