Available reward money

Before any reward money is paid to employees, you must decide the total amount that is available for company-wide rewards. Allowing for capital requirements, retirement of debt, dividends, retained earnings, and other items, you will determine the size of the available reward pool for the employees, if the goals are attained.

As an example, our clients often have paid a reward of 7 to 25 percent of salary to their employees when the company goals are attained. Some have created a reward system that literally has no upper boundary in terms of total dollars paid—as the company does better so too do the employees. It’s up to you—just be very clear about the ground rules.

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