Sadly, the current market and the economy have made it relatively easy for the employers, to forego payment of signing amounts. In these tough times it is indeed difficult and awkward to ask for a signing amount.
The initial rounds of interviews are over and in the face of intense competition and gnawing doubts and anxious waiting you have finally been offered the job. Now comes the second part of the stringent efforts, negotiating the financial aspects of your job.
You will be incurring considerable expenses relocating to this job; moreover, you have already incurred substantial expenses preparing for the interview. Will your new employer be giving you a signing bonus? If so how much will it be you wonder? If he does not give it, do you ask for one? Will he attach conditions to it?
After nailing a few rounds of interviews, you've been offered the job, and now it's negotiating time. Should you expect your future employer to offer a signing bonus? If so, how large should it be, and what strings may be attached?
First it is important to understand that the employer is well within his rights not to offer you one. It is not given to every employee. It is given to those, whose service the company values a lot and is an inducement for them to join.
Since signing amounts are not the average monthly salary or your daily wages, there is a certain sense of indistinctness about them. Here are some frequently asked questions that should clear the vagueness.
Who Gets Signing Bonuses And Who Doesn’t?
If you are a new candidate, just finished your education and this is your first job, chances of a signing amount coming your way are negligible. But that does not totally rule you out altogether also. Experienced workers, who could bring additional value to the company, are more likely get signing bonuses. Even they may not get it. It all depends on what the employer considers your worth to the company.
How Much Is A Signing Bonus?
It all depends on the value the company places on the employee. In the case of high-profile sportsmen the money could run into millions, but we aren’t talking about them. It’s not their work but their persona that gets them the money. It is normally 5 percent to 10 percent of the base salary of the employee.
What Are The Reasons Why Signing Amounts Are Given?
There are primarily three reasons why employers give signing bonuses. To know whether you deserve a signing bonus and whether you should be asking your employer for one, assess if any of these three reasons apply to you. If you feel that they do, then certainly go ahead and ask your employer for a signing bonus.
- To Outbid Other Companies:
If there is a special employee who is being eyed by other companies as well, then the company will resort to devices like signing amounts to ensure that their offers do not tempt you into fleeing.
There are many fields, for which apt workers are not easily available and there is an acute shortage. These include fields like nursing, engineering, accounting and other professions requiring high-skilled jobs. Such employers are normally recruited by the company and don’t have to apply for jobs. A recruited worker is practically assured of a signing bonus.
- To Safeguard Company’s Salary Policy:
Most companies have a wages and remuneration policy which authorize minimum and maximum salaries for all positions. You may ask for a higher salary than what you have been offered. The company says that, much as they would have liked to accede to your request, the company’s policy deters them from giving a higher salary. Rather than lose you, they circumvent the issue by making up the difference, with a signing amount.
- To Accommodate Benefits Lost Owing to Relocation:
If you are an experienced worker and have been recruited to this new job, shifting will cost you a lot of money. Your earlier company will certainly not give you the year-end bonus and neither will you receive your monetary benefits that would have accrued to you if you had not left your job.
Moreover, there could be extra commuting costs. Childcare or spouse’s loss of income, when you relocate, can also be an extra burden on your finances. The employer may use a signing bonus to make up the new expenses and the cost of benefits you missed out on.
It is always advisable to check out the terms and conditions of the signing bonus. Sometimes it could be better not accepting one. Since it is something that is given to retain or recruit a valuable employee, most companies will say, that the signing bonus will have to be returned if you leave before a certain date. It could be years from now. Are you willing to commit yourself for such a lengthy period?
At times it is better not to take a singing amount but to negotiate an increase in your salary. The bonus is a onetime payment whereas the increase is permanent and over the long-term will be more in monetary terms. Moreover, a higher salary will put in a higher bracket of employers who draw pig pay-checks. This will raise your admiration amongst your colleagues and will be good for your self-esteem too.
