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Retention Bonus

Retention Bonus

Posted: 14th January 2022

Viewing 2 posts - 1 through 2 (of 2 total)
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  • #15652
    Anonymous

    Hi all

    We are a start-up business and we would like to put a retention bonus in place (or a success bonus) to incentive people to stay until series B. Has anyone done this, what % did you do, was it across the board and was it successful?

    Would be great to talk to anyone if they have any experience.

    Many thanks
    Laura

    #15658
    Anonymous

    Hello Laura,

    Yes we did a couple of years ago and it was an absolute success. It is a retention bonus calculated based on the annual performance bonus. The rules, more or less are:

    · Your retention bank is calculated based on your annual performance bonus.
    · Your annual on target bonus is set as a % of your base salary for 2020
    · The companycontributes an additional 50% of your annual bonus into the bank.
    · The retention bank contributions are paid in March of each year when performance bonus payments are made.
    · The amount in your retention bank will accrue annually.
    · After receiving three years of bonus payments, you may withdraw one third of the funds accrued in your retention bank
    · Contributions will start from March 2021 and continue each year. You will be able to make your first withdrawal from March 2023 onwards.
    · This scheme requires reauthorisation every three years.

    If they leave the lose it, and every year they receive a third of the pot if that makes sense.

    Feel free to contact me if you need more information.

    KInd Regards

    Gloria

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