Some companies looking to keep key employees may agree to pay retention bonuses. By remaining with the company for a certain period the employee can collect a bonus that’s additional to all other pay, such as regular salary and performance bonuses. The intent of the retention bonus is to make a star employee think twice about leaving the organization for another job. Retention bonuses are often negotiated when the employee joins the company.
Network with people in the industry to determine if your role qualifies for a discussion about retention bonuses. Usually companies pay the bonuses only to executives and for hard-to-fill positions. Contact trade associations, recruiters or former employees of the company to ask about the company’s likely position on retention bonuses.
Get details of the company’s job offer to you in writing. It’s fine to discuss salary range once the employer indicates you’re the choice for the job, but don’t lock yourself into a too tight range. Offer your salary range based on your current salary and research about what the job should pay. Negotiate the salary first, then the retention bonus.
Meet with the hiring manager or HR person, or talk over the phone if you’re out of town. Ask the company to increase the salary offer just a bit if you feel that overall the offer is fair. The company may not start with its best offer. How much more to ask for is up to you, but asking for $1,000 or $2,000 more usually isn’t a deal breaker. However, you should ask for more if you honestly feel the company’s offer is low.
Cite reasons for wanting a larger salary, such as cost of living issues. If applicable point out that the company’s offer is not much more than your present salary. Or indicate that your research shows that the job simply should pay more based on the duties and responsibilities and salaries offered by competitors.
Open discussions about a retention bonus near the end of the conversation. Do not push back on salary and wait until that is resolved to discussion a retention bonus. Make a case for the retention bonus. Talk about your desire to remain with the company for several years. Explain that you would like a financial incentive to stay. Discuss how you frequently receive calls from recruiters, if that is the case, and that you would rather not listen to their pitches at all. Point out that you believe the retention bonus merits discussion because other companies are offering the bonuses.
Ask the employer to suggest a reasonable retention bonus based on arrangements for other new hires. If the employer wants you to go first choose a reasonable percentage of your requested salary such as 10 percent.
Negotiate details of the bonus if the company agrees to pay the bonus. For example, ask that you receive the full bonus on your third anniversary. Continue negotiations until you have a deal on salary and a retention bonus.