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Retention Bonus

Retention Bonus

Posted: 14th January 2022

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  • #15652

      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


        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


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