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Five tips to follow if you can't pay a discretionary bonus

by , 27 August 2015
A discretionary bonus is a payment made to the employee based on his performance at your sole discretion.

But what happens if you can't pay a discretionary bonus? Even if the employee meets the criteria or if you want to change the ways of measuring work performance...

Here are five tips to follow if you can't pay a discretionary bonus:

1. You must ensure your reasons for not paying the bonus or for changing the ways you calculate performance are fair and reasonable.
 
2. You must tell the relevant employee as soon as possible of the change or problem and give adequate reasons for it.
 
3. When giving these reasons, you need to be clear and unambiguous. 
 
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4. Give the relevant employee an opportunity to make suggestions to you before enforcing the changes or confirming your decision not to pay him. 
 
5. Do your very best to resolve any issues and be open to discussion on them with regard to the bonus.
 
So there you have it! There are five practical tips to use when you are unable to pay a discretionary bonus. 

To learn more, click below…
 

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