Job sign-on bonus?

[swasat]

Hi all,

I am a log time lurker from the old msn YM board. I remember most of you from there

So here is the question: Is a sign-on bonus quite commonplace for non armed forces jobs?

A colleague accepted an IT job with a major cloth retailer (A and F) and is raving on an on about how they gave her a 45% (!!!) raise and a hefty sign on bonus? I am almost green with envy....

I am of the impression that its very unusual...until they have a tough time filling the positions. This colleague has about 3 years of experience and none of it is super specialized. Something just does not seem right about so much money being offered.

So again, is it very common to get a hefty sign-on bonus? I have been in IT industry for 8 years and changed 3 jobs and not one company had the sign on bonus policy

Oh, did I mention I am burning with jealousy ;D

ETA: This is her first job change since passing out of college 3 years ago. Technically her second job.

[Deleted]

It used to be very common place in the financial industries. I am not sure how common it is these day, though.

[swasat]

Do you have a % ballpark about how much its used to be in financial industries?

We IT software people are nicely compensated. So I am having a hard time coming to terms with 45% raise and 20% sign on bonus thing.

Dark Honor is in IT....maybe he can shed more light....

[Baby Fawkes]

The company that I work for still gives sign-on bonuses and my GFs sister just accepted a job where they gave her one. Small sample there though. Both companies have fairly strong stipulations tied to the money. For mour company the sign-on bonus vests 20% per year for 5 years so you don't even see a penny until you've completed 12 months. For my GFs sister she gets it all up front but has to pay it back pro-rated if she leaves within the first 3 years.

I should also add that the sign-on bonuses were not amounts worth being overly jealous about. For me it was in the form of stock and was 100 shares over 5 years (not a high $ value share). I know that a lot of experienced people here can easily see 10x that amount though, but I was a college hire when I got mine.

[Deleted]

Ask for proof.

[achelois]

I got a 20,000$ sign on bonus when I started my present position

[swasat]

May 13, 2011 12:49:34 GMT -5 @mmc said:

Ask for proof.

You know I can't I understand it might all be bullshit talk on her part. The numbers might all be faked.

I just hadn't heard of a sign on bonus (with no contractual terms or obligations) , specially int he IT industry.

[Frugal Nurse]

The hospital I work at offers new graduate nurses a $3500 sign-on bonus for signing a one year contract, and you can renew it a second year for an additional $3500.

[swasat]

May 13, 2011 12:52:22 GMT -5 achelois said:

I got a 20,000$ sign on bonus when I started my present position

What industry do you work in? I am in the wrong field

If that was the bonus, how much the pay raise would be....

[alabamagal]

Sign on bonuses are not uncommon for professional jobs in a competitive field. You don't really say how much it is. A 45% raise seems a bit much, unless she was grossly underpaid in her previous position.

I once recieved a job offer with a 95% pay increase, but it was because I was way underpaid. Even with the 95% increase it was still 30% less than I had been making before I was laid off from a Fortune 500 company.

[CarolinaKat]

My friend who works in the IT dept for the financial industry got a nice signing bonus, but it wasn't HUGE... like 3% of salary or something

ETA: It might have been 7%... Can't remember which

[swasat]

May 13, 2011 13:07:04 GMT -5 CarolinaKat said:

My friend who works in the IT dept for the financial industry got a nice signing bonus, but it wasn't HUGE... like 3% of salary or something

See, thats what I am talking about. That seems reasonable. But 20% bonus, on TOP of a 45% raise, is making me call BS on it.

And georgiagal, I don't know her salary here, but she was definitely in the medium-high range for her pay scale. This is verbatim from her.

[Baby Fawkes]

My job is in the IT industry and and the sign-on bonus that I got out of college was approx. $3000, but a lot of people with experience typically get 5x - 10x that amount here.

[Deleted]

I work for a major player in tech and we do give sign on bonus. Usually, this is in the form of stock that vests over 4 years. The value depends on the stock price at time of vesting of course, but the amount I received 2 years ago when I started was worth 40% of my salary at today's stock price.

I negotiated hard on salary and stock grant and didn't ask for a cash starting bonus. I have heard other people recently received cash bonus bonus in the 10-15% range.

[tskeeter]

I don't think sign-on bonuses are all that common. In some industries, yes. In most, I don't think so.

Sign on bonuses can be used for a number of reasons. Some companies will reimburse your relocation expenses, others may use a sign-on bonus to accomplish the same thing. A pot of money is a great enticement if the base compensation or other benefits are a bit below industry standards. A one time sign-on bonus doesn't inflate your compensation cost for years and years, and may allow you to hire talent you couldn't otherwise attract.

I used a sign-on bonus once, to let an employee who was transferring to my staff how valued her services were. This employee had been in a job that was much better compensated. This meant that she was already compensated above the market value for the position I was filling. With this particular transfer, I would not have to pay the relocation expenses I had anticipated. So, despite the fact that I couldn't give the new employee a raise, I was able to use money allocated for relocation reimbursements to offer her a bonus she was not expecting. Best move I ever made. That employee was a superstar with gold clusters!

I received a significant bonus when I transferred from Chicago to LA. The bonus was intended to help compensate for the much higher cost of housing in LA. This was done in that market because otherwise people wouldn't transfer to that location because they couldn't afford housing.

[Deleted]

I was recruited for my current position by a headhunter

Corp Controller

And there was a signing bonus....and relocation package

There were stips on both......and the money was held in ESCROW till stips were met

For any significant bonus...this is normal

Bonus was 20% of annual salary

[swasat]

Hmm. Some more info....

There is no relocation involved.

This is a midwest town (MCOL)

ETA: Its a lump sum cash bonus, not stock. Per her: No contractual obligations to spend x years in the company or getting the amount over several years.

I am sure you all might be wondering why I am SO interested in the numbers. I am genuinely curious. Yes I am. The city we live in has a ton of IT companies and I know a lot of people in the same industry. I have a general idea of the salaries here. So this one has thrown me for a loop. Also because I know the technical calibre of the said person as I work with her.

[ihearyou2]

I've worked in accounting for a while and never been offered or had the company I worked for to my knowledge, offered a sign-on bonus, always they were back-ended which makes sense. I think a sign-on bonus is a dumb idea from an employers' perspective, a great resume does not translate into a great employee.

[Deleted]

You sure you work in accounting, IHOP?

[Deleted]

Get out of the BIG 6 firms and go work for private companies

The partnership wont be there in 20 years....but the money is good, and the politics are less trying

I will never go back to another big firm

[ihearyou2]

Smart boy as far as the work environment, CPA work is for suckers. Its boring as hell and unless you're a partner you're not getting paid enough for the hours worked. The sweet spot is a medium sized company as a CFO that is growing in the range of 50-500M and you can do really well, enjoy the work, and not have to work like a dog.

[Sum Dum Gai]

Dark Honor is in IT....maybe he can shed more light....

IT is a pretty broad umbrella so it probably varies quite a bit by specialty. I haven't heard of too many sys admins, DBA's, or network specialists getting sign on bonuses. Moving costs for positions that required a move, but not straight cash signing bonuses. Maybe for a hot shot programmer or something really niche though.

You mentioned this was an earlier career position, so it could be a case of signing bonus to draw in talent but fairly low pay. *shrug*

[lurkyloo]

I got a 5K signing bonus five years ago (starting salary was around 79K) I work in biotech, though, not IT. I think DH got 10K signing bonus, but his field (engineering) is in higher demand and better paid. Plus he's kind of an all-round superstar

It was explained to me that the signing bonus was supposed to help with startup costs (new place to live, different wardrobe, etc) and in my case relocation costs were reimbursed separately. I think I might have had to pay part back if I left within 18 months, but don't quite remember.

[dragonfly7]

I really think it depends on the position. Several local school districts offer sign-on bonuses for middle and high school math and science teachers (and sometimes special ed. and ESL). Half is usually paid in December and the rest at the end of the school year. DH's district doesn't do that, but their starting pay is higher than most of the districts offering the incentives.

[❤ mollymouser ❤]

If you join the military with the right qualifications, education, test scores and career field, I know you can get up to a $40,000 recruitment bonus (and possibly more if you're a doc/dentist.)

[jeffreymo]

I've seen signing bonuses offered as a way to bridge a gap between a salary offered and a salary desired. A friend of mine received a job offer a couple of years ago and the amount was just shy of what he was looking for. He really wanted the job and asked if they could go a little higher. They countered by keeping the salary originally offered and offered a signing bonus as an extra enticement.

[swasat]

May 13, 2011 15:13:50 GMT -5 ❤ mollymouser ❤ said:

If you join the military with the right qualifications, education, test scores and career field, I know you can get up to a $40,000 recruitment bonus (and possibly more if you're a doc/dentist.)

Right. I know that's how it is in the armed forces.

This is a IT job. The salaray range for her grade is 50-60K. Even if we assume she is currently at 60K, a 45% raise puts her in 87K bracket. The 20% bounus then equates to 18K. Thats a LOT , I say again "LOT" of money for a person with 3 years of experience with plain backend Java coding.

I somehow, cannot wrap my head around that any company would pay that much for entry level. That too in the midwest where the COL is medium.

[buster]

An old coworker of mine moved between Fortune 100 companies working in IT and got a sign-on bonus at around 20% and a salary in the 120k range.

This person's experience is very specialized and this person received 4 serious job offers all from large organizations within 3 months of looking.

[reader79]

My former boss received a $20K signing bonus at my company. He worked through a headhunter, and she told him that we had been known to pay these. I found out when I noticed the line in the budget report and asked him what it referred to. He told me that it is always worth the request. They'll respect you for being a good negotiator, and assume that you will use those skills on their behalf.

[Sum Dum Gai]

With the big raise and bonus, I'd probably put her at the lower end, or even below that range you gave.

When I separated from the military and got my first IT job I wasn't asking for enough. Over the next couple of years I got double digit raises every year, partly because I was doing a good job, and partly just to catch me up to what I should have been making the whole time anyway.

Maybe she started at something like $40k, the 45% raise put's her at $56k (which is right in the middle of the range), and the 20% bonus was on the $40k so it was $8k. Still a nice chunk of change, but she's not going to buy a new car with it.