← HR Metrics·Compensation & Benefits
Bonus Payout Rate
Average bonus as percentage of base salary
How it’s computed
AVG(bonus) / AVG(base_salary)
What the evidence shows
Evidence (effect sizes, priors, validity) is syncing from Principia.
Run it on your data
This metric is computed in the People Analytics Toolbox on your own numbers. See pricing — posted, no quotes.
sources: toolbox:metrics-catalog
What the literature says
The measurement literature behind this signal — sourced, so you can defend it.
“TI-Linked Bonus—Hurdle Bonus plans can use the same linkage methods as commission plans, such as hurdles, multipliers, and matrices. Bonus plans can use hurdles to tie two or more performance measures together. As illustrated in Figure 5-45 , the retention rate of current…”
— Compensatingthesalesforceapracticalguidematch 58%
“Employees tend to decide more like owners when they have skin in the game. Profit-sharing also helps attract employees and keep them loyal (the selection effect). In some cases, like Lincoln Electric’s, the profit pool can become a significant portion of overall compensation.…”
— Scaling Up Compensationmatch 56%
“See also discretionary and nondiscretionary bonus.[C5, C11, C12, C15, T1, T2, T9, GR1, GR5, GR6, GR7] Bonus guaranteeA payment in addition to base salary that is made regardless of performance (e.g., an incentive award that is guaranteed, usually to a new hire or to a newly…”
— Worldatwork Handbook Compensationmatch 56%
Resources: Compensatingthesalesforceapracticalguide · Scaling Up Compensation · Worldatwork Handbook Compensation