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How a Signing Bonus Can Take Your Recruitment Efforts to the Next Level

Source: Anthem: The Benefits Guide

signing bonus

The majority of companies — 74 percent, to be exact — give bonuses to at least some of their new hires, but amounts vary widely depending on the field. Signing bonuses usually come in the form of a lump sum given at the start of a new job. Unlike a relocation payment, there are no strings attached to how the employee may use the money. A bonus isn’t a magic recruitment wand, and it’s not meant for every circumstance.

Here are three situations, however, where a well-placed bonus can help bring in a new hire.


Nick’s take

My good buddy Suzanne Lucas (the infamous TheEvilHRLady) offers a good primer about signing bonuses. Written for employers — it’s an insider’s view! — this article explains what a signing bonus is, what it isn’t, and why companies grant them to job candidates. Signing bonuses aren’t just for executive-level jobs. Don’t try to negotiate your next job offer without understanding how you might score a lump-sum signing bonus!

What’s your take?

  • Have you ever gotten a signing bonus in your job offer? How much?
  • Did you ever have to return a signing bonus because you quit too soon?
  • If you’re an employer, when and why do you give signing bonuses?




: :

  1. I turned down a job offer with a modest signing bonus – it would have required a move that would have greatly disrupted my family life. If the bonus would have been an order of magnitude higher maybe I would have considered it.

  2. I’ve never been offered a signing bonus, nor would I accept one. Don’t offer me a “competitive” compensation package – offer me a “superior” one instead.

    As Suzanne Lucas notes, the contractual relationship created via said “signing” and the at-will statutory relationship are at odds with one another. I’m not an attorney, but there’s got to be some juicy case law out there involving situations in which employers either made material misrepresentations to the employee during the hiring process that negated the contract, or in which employers engaged in unlawful conduct that spurred an employee’s decision to quit. In those situations, should an employee still be held to the terms of the signing bonus? Of course, this will all be muddied by legislation such as California’s Assembly Bill 5 (2019) which reclassifies many independent contractors as employees. Many so-called “gig economy” companies have lured workers via signing bonuses.

    • @Garp: You are absolutely right. What people often miss is that a signing bonus is a one-time payment. It will not affect future raises or retirement account contributions and other benefits based on salary. That’s why companies love to use them. That and any claw-back clause.

  3. I once negotiated a signing bonus, but the circumstances were odd and I wouldn’t recommend it to anyone without those odd circumstances. A company had head-hunted me based on reputation for a position they were creating. The salary we eventually arrived at was higher than they had expected (simple inexperience on their part) but they were committed to the position so things were good. At the same time, a family expense hit that was a couple grand more than we had budgeted so I was looking at a short-term loan/credit expense. Without going into tedious details, we worked out a small signing bonus with a corresponding decrease in base pay. They aren’t stupid, so they jumped at the chance–yeah, the math worked out in their favor, but it was framed in a “helping each other” way that eased some of the tension from their unrealistic expectations earlier as well. Classic win-win, not least because I suspected that the hard (fun) part of the challenge would be digested in a couple of years and didn’t expect to carry that reduced base pay forward forever.