Retention Bonus

Posted in Human Resources Terms, Total Reads: 3274

Definition: Retention Bonus

Retention Bonus is basically a strategy adopted by organisation’s to retain their valuable employees and prevent them from leaving the company during crucial periods.

This bonus is either forms a percentage of the employee’s salary or paid as a lump sum of money at the end of the period.


Companies undergo a lot of critical periods like acquisitions, crucial projects or mergers where it becomes absolutely essential to retain the talent pool within the organisation to ensure the successful completion of the business activity.


For instance, if any activity would probably take say 14 months, the bonus is given after 18 months to ensure the employee’s presence in the company.

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