When the Bonus Becomes an Obligation
Do your employees think they’re being rewarded for performance? Or do they think the end-of-the-year bonus check is a routine part of their compensation?
Good Morning!
Here are today’s highlights:
President Trump’s tariffs are encouraging big companies to fill their supply chains with small companies—if they can find them.
The number of one-person businesses continues to surge.
In Alabama, builders are souring on mass deportation—and pitching a work-visa program.
Ron DiMenna, founder of Ron Jon Surf Shops, helped make surfing mainstream.
HUMAN RESOURCES
When this business owner cut profit-sharing, his employees lashed out: “A small business owner from Philadelphia called into the ‘EntreLeadership’ podcast recently to ask personal finance personality and business coach Dave Ramsey for advice. The caller, Mike, runs a $15 million-a-year industrial distribution company with just 16 employees, many of whom have been with the business for decades. The company, family-owned for generations, has always distributed 100 percent of its profits at year-end between ownership and employees. For some, this bonus had become expected. But after a rough year with reduced profits, the company scaled back those payments.”
“The result? Backlash, especially from longtime employees. One even threatened to quit if the company ever paid less again. ‘If you ever do that again, I’ll walk out,’ the employee told Mike.
Ramsey was stern. He even called the disgruntled employee ‘entitled little twerp.’ ‘That’s the last conversation I have with that person,’ he said. ‘You don’t freaking threaten me. I own this. You are confused.’”
“According to Ramsey, the mistake was framing the bonuses as a guarantee instead of what they truly were—profit-sharing based on available earnings. ‘We are sharing what our family owns with you. We are not obligated to give it to you,’ he said. ‘But we have chosen, as an act of kindness, to share with the people that run the business with us.’” READ MORE
