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I have a question on behalf of my nephew. He just received an offer letter where the terms of the sign on bonus are that if he leaves prior to 36 months, for any reason, he must pay it back. While interviewing, he was told they would buy out his current bonus, but this doesn't seem like that is factual, they are, in essence, making it part of his pay.
I am not an expert in this area, but it seems wrong to make him pay it back under a situation that is not in his control, and also, 36 months seems like it is too long.
I told him he should not accept as is, but try to negotiate better terms, of course, I don't know what to recomomend!
I would appreciate any thoughts on this situation if you have experience in this arena.
It's a signing bonus with a repayment agreement -- pretty common in the sports world -- and it's negotiable.
Try to negotiate a shorter term, say, 12 months instead of 36 months, or a larger bonus or a partial repayment.
Or accept the bonus but don't spend it (still got to pay taxes on it).
I have received several signing bonuses. Every single one of them had some time frame where if I left voluntarily I had to repay the amount. Now the question as to if the company would actually try and get it back is another story.
I have received several signing bonuses. Every single one of them had some time frame where if I left voluntarily I had to repay the amount. Now the question as to if the company would actually try and get it back is another story.
Thanks, appreciate your insight. So is 36 months reasonable for a full payback? Or would 12 months be more reasonable since this is supposed to be buying out the current bonus?
For 36 months, the amount need to be significant enough. My sign-on bonus was $12,500 net with 18 months. It was pro-rated after 6 months (0-5 months, pay back 100%, the 6-18 months pro-rated).
One of my co-workers received $20,000 net sign on bonus with 24 months. He was let go due to re-structuring after 14 months but he did not have to pay it back.
What was the amount of the bonus your nephew was offered?
Thanks, appreciate your insight. So is 36 months reasonable for a full payback? Or would 12 months be more reasonable since this is supposed to be buying out the current bonus?
Seems a bit long to me. But every company is different. He could always turn it down if he feels the terms are not to his liking.
For 36 months, the amount need to be significant enough. My sign-on bonus was $12,500 net with 18 months. It was pro-rated after 6 months (0-5 months, pay back 100%, the 6-18 months pro-rated).
One of my co-workers received $20,000 net sign on bonus with 24 months. He was let go due to re-structuring after 14 months but he did not have to pay it back.
What was the amount of the bonus your nephew was offered?
It was his current bonus prorated for 7 months. I don't have the specific amount..
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