When it comes to recruiting finance and accounting employees, a sign on bonus can be a great way to increase the ability to attract the best candidates. Yet, some still wonder if a sign on bonus is worth offering or if there are other incentives that may provide equally positive results?
Get the Facts on Sign on Bonuses
Let’s go over the basics first. A sign on bonus is generally a lump sum of money that’s offered to a new employee once they have been selected and completed a short period of time on the job. The sign on bonus is used to attract high level candidates away from other job opportunities and is often advertised to accomplish this.
In some cases, a sign on bonus may only be offered if the candidate meets the required performance goals of the job and stays onboard for the first 30-90 days of employment. Sign on bonuses are generally used for recruiting executive level candidates and those with specialized skills that are hard to find. Other times, sign on bonuses are used to attract new college grads who have updated skills.
Making the Case for Sign on Bonuses
Before you decide to offer a sign on bonus, there are certain considerations you will want to understand. Any bonus is a cash investment in the future success of your company. It can be a way to boost performance and productivity for new hires. But it should only be used selectively as a recruitment tool. Getting the most from sign on bonuses means you need to have the following factors present:
#1 – Is the position very difficult to fill using standard methods?
The only time you will want to use a sign on bonus is if the position tends to be highly difficult to fill. This happens with specialized skillsets and projects that make it impossible to find candidates for. For example, you may have a project that requires someone to have a specific degree combined with work experience in a rare talent.
#2 – Are industry competitors offering a sign on bonus for similar job types?
Look around at what your closest competitors are offering their new hires. Check to see if they are advertising sign on bonuses for the same types of jobs that you have openings for. Then step things up with a higher sign on bonus. Even a small amount can be very attractive to the best candidates – meaning you beat the competition.
#3 – Is there a direct project you can allocate the bonus to?
Before offering a sign on bonus, consider that you must have a way to warrant the expense against client billings. Look at the projects that are coming in and decide how you will make a business case to offset the cash reward to the employee. You may want to take it to the negotiations table on specialize projects that require the best skills, then bill at a higher rate to make this more feasible.
#4 – What can the bonus do for my business in terms of revenues generated?
You are in the business of being in business, which means every employment cost needs to result in growth for your organization. Therefore, decide how a sign on bonus can help a new hire ramp up his or her skills sooner so that there is a chance of earning more money through added productivity. Sign on bonuses can be a positive incentive for getting more from your workforce early on.
As you develop a program for offering sign on bonuses to key assignments within your business, review these factors several times to make sure they fit well. Try to come up with a total compensation package that is attractive to your target candidates that include a well-rounded approach. Talk with the staffing pros at Casey Accounting & Finance Resources – part of the Arlington Resources family and a leading Chicago staffing firm for more help with recruitment sign on bonuses.