Bonus systems may need to be changed in times of crisis

Many employers took advantage of the anti-crisis shield and wage subsidies.This financial injection certainly helped in many cases to survive the first period after the pandemic and the so-called lock down. However, now employers face new challenges related to taking actions not of an ad hoc nature, but of a long-term nature. It may be necessary to modify the strategies chosen so far, including salaries for the next months, and maybe even years. One of the significant costs of running a business are remuneration costs (including costs of various types of variable components, such as bonuses). Bonus systems may require modification so that, on the one hand, they continue to fulfill their function and motivate to act (which may be particularly important in the period of recovery from the crisis), and on the other hand, that they are adapted to the financial capabilities of employers. It cannot be ruled out that in some cases it may be necessary to temporarily suspend the payment of bonuses because only such radical actions can save the company from collapse. – Sandra Szybak–Bizacka comments for Prawo Pracy.

Article: here.