Five Best Ways to Handle a Bad Bonus: GUEST COMMENT

It’s bonus time again, a time of anxiety and a time of hope. Some may be high-fiving their colleagues – but inevitably some will be unhappy with the news.  The question is: if you’re disappointed, what’s the right way to handle the situation?

1. Pause

The first thing to remember: don’t react immediately.  No matter how bad the news is, the best thing to do is to take a deep breath, to indicate that you need to process the information, and ask for an opportunity to discuss things further once you’ve had time to reflect.  And don’t let your manager try to draw you out on the subject – you’re probably not in any state to react intelligently and constructively.

2. Reevaluate

Go home and think about why you’re disappointed.  Were your expectations unrealistic?  If you’re convinced they were realistic, why do you think you were underpaid?  Is there an underlying message that your managers are trying to tell you?  If you’ve already had your performance review (note: best practice is to give an employee the performance review before and independently of the compensation discussion) and the message you got was inconsistent with the bonus, that’s something to discuss.

3. Check

Do some checking.  Headhunters can help – they should know the range of compensation for your job and level.  You may also be able to check discretely with colleagues, but do so at your own risk!

4. Discuss

If you’ve done your homework and still feel aggrieved, set aside a time to discuss this with your manager.  A constructive approach would be to say that you are disappointed with your bonus; that you would like to get to a specific target next year; and ask whether and how you can get to that target. If your goal is realistic, ask your manager to specify performance objectives that would get you there. If your manager considers your target for next year unrealistic, that is important information.  With this, you can decide either to lower your expectations, or begin to look for a new position that has a better chance of meeting them.

5. Quit

They key here is to take your time, do your homework, and try to be realistic about what you should be paid.  If, after you’ve done all this, you still feel that your work is underappreciated, and you see no prospect of it changing in the next compensation cycle, it may well be time to see if you’d be better appreciated at another firm.

David Schwartz is CEO at search firm DN Schwarz & Co. He is a former director of recruitment at Goldman Sachs.