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By Michelle Wanjiku
What is a bonus? It is compensation that is given above the amount of pay specified as your salary.
As the year comes to a close, most employees are expecting to get an end of year bonuses. However, this is not always a guarantee as there are a few things your employer will consider before giving a bonus.
But first, why do employers issue bonuses ion the first place?
Most organizations pay bonuses to their employees to thank and congratulate them on meeting and achieving specific goals.
Bonuses increase passion for the company
As an employee you are probably invested in the work you do, therefore getting a bonus for doing it well will make you even more invested to do it better.
Bonuses increase productivity
People like to be appreciated for the work they put in; therefore employers know that by saying thank you for all the hard work that year, they are motivating you to work even harder the coming year.
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Here are a few things employers consider before giving bonuses
Your performance
One thing an employer will look at before giving you a bonus is how you have performed the whole year. Did you meet or exceed your goals in terms of your key performance indicators?
If you did, then you are more likely to get a bonus when the year comes to an end.
The company’s performance
Another thing your employer is bound to look at is how the company performed overall. Even though as an individual you could have met all your set goals, if the company was not able to meet its financial goals then you might not be getting the end of year bonus.
Your pay grade
How much money you get as a bonus payment will depend on how much you are currently earning. The higher your basic salary the higher your end of year bonus will be.
Employers know that the bonus they give you needs to have an impact on your finances. For example, if you are earning 80K per month, a 5K bonus might not make a big difference whereas if you are earning 10K the 5K bonus will be a big deal.
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The economy
It is obvious that the economy has a huge impact on how the company performs and if times are hard it will also be difficult for your employer to give you a huge bonus.
This is because the company is probably trying to save as much as they can and so they won’t be able to spend a lot of money giving an end of year bonuses.
That said,
If you are to get a bonus at the end of the year, you need to remember not to spend it all on frivolous things that will not add value to your life. If you are smart about how you spend it, you will be ensuring that you achieve your financial goals a lot faster.
The writer is a Communication Officer/Digital marketer at Career Point Kenya. Email: michelle@careerpointkenya.co.ke