Eighteen months ago, IT professionals could easily expect sign-on bonuses, retention bonuses, and others in between. Now it takes more than just being at work to get a bonus – and that’s not because the money isn’t there. Even for companies with a dedicated line item for incentive awards, getting that money is tougher than ever before.
According to David Foote, managing partner and chief research officer at Foote Partners LLC, a management consultancy and IT work force research firm in New Canaan, Conn., current trends indicate that the general pool for bonuses is increasing. “The gross amount being paid in bonuses is climbing,” Foote says. But with a decline in the economy, companies aren’t paying out as many of the different bonuses as they once did. Bonuses are more often being tied to measurable milestones, Foote says.
Foote Partners surveyed 24,000 IT workers in more than 1,500 private companies, government, and non-profit organizations in North America and Europe to find out why this trend is on the upswing. “A whole lot of money was being burned [during the boom], and a disproportionate amount of that money was being paid to people who didn’t deserve it. Companies were less organized about how they paid bonuses,” Foote says of the survey findings.
In fact, according to Foote, last year some IT professionals got as many as six bonuses on top of their base pay. “Companies were worried about losing people, so they ‘bonused’ them in anticipation of the projects they had coming down the pipe,” he says.
All that’s changed as companies now are unwilling to pay out bonus monies without getting something measurable in return.
Employers today expect milestones to be met, and they are measuring along the way, according to Foote. Bonuses for IT professionals, he says, are tied to these results – often project milestones or revenue goals.