Labor Day: A bonus by any other name

Here’s a little homage to the search gods: This is the BEST LABOR DAY POST. This is the post that appeals to LOWEST CAR INSURANCE shoppers, HORNY STEP-MOM and BARELY LEGAL TEENS.  Whether you’re one the HOTTEST GUYS or the HOTTEST GIRLS, this is the CHEAPEST BEST LABOR DAY POST and it’s … OMG what have I become? Well, in all honesty, this post applies to FREE MONEY (Sorry, couldn’t resist) because it’s about one, heretofore mostly obscure, feature of our modern corporatified reality and it deals with labor and money. Let’s discuss the workplace BONUS: 

In the 1989 movie National Lampoon’s Christmas Vacation, the character Clark Griswold played by Chevy Chase had a good point on company bonuses:

“I was expecting a check. Instead I got enrolled in a jelly club. 17 years with the company. I've gotten a Christmas bonus every year but this one. You don't want to give bonuses, fine. But when people count on them as their salary, well what you did just plain...”

I wouldn’t suggest getting even by kidnapping the big boss and presenting him hog-tied with holiday ribbons and a bow under the family tree, which is what affable, red-neck and probable-MAGA-fan cousin Eddie did in the film. But Clark brings up a really good point for the labor day, when is a bonus a bonus and when is it just pay?

Couple of terms to get straight here. I’m not talking about a contest. A contest is where there are a set number of winners no matter how good everybody else does. Not talking about an incentive: an incentive can take the form of a cash bonus and everyone can earn it, but it’s typically a one-time deal. I’m talking about cash bonuses, paid monthly, usually to hourly workers, and usually based on performance and/or production. Generally speaking, those kinds of bonuses are better than no bonus. But there are some drawbacks:

• A company is obligated to pay your salary or hourly rate and there are legal enforcement mechanisms available if they don’t. Those don’t exist or are greatly weakened in the case of the kind of bonuses we’re talking about.
• If an employee must go on disability or unemployment, or passes away, those benefits will typically be calculated on base pay, and not include monthly performance bonuses. 
• Bonuses are much easier to play bullshit games with and therein lies the problem today...

Why would a perfectly profitable company look to reduce or eliminate bonuses for their crappiest paid workers with obsessive, pathological determination? Obviously, those bonuses cost money and, absent a union, those workers have zero power. So once the company is up and operating, once they have clawed their way into a market and staffed up to serve it, and especially once they have beaten their rivals to the IPO market and burned them to the ground, the pressure is on to deliver earnings. And more earnings, and even more earnings, quarter after quarter, year after year, the stock-price is always hungry. In the ye olden days this process might be called morganization. I like Cory Doctorow’s more modern term, enshittification. 

There’s a lot of ways to enshittify and Doctorow’s article details large web platforms and all the ways they ultimately hose us, workers and customers alike, until they turn into a pile of shit and die. But traditional brick and mortar companies can still get into the spirit! One step along the way happens to front-line worker bees who get paid a monthly bonus based on production or performance. The bonus check very slowly dwindles month over month, with of course no off-setting increase in base pay. This is usually dressed up in contests, incentives, changing metrics, maybe even an unexpected surpluss to dazzle and delight, but the overall trend is down. Like the proverbial frog brought to a slow boil in a pot, we’re supposed to not notice that our pay is down 20 percent over the past two years and it’s all in bonuses. 

There are a lot of reasons for companies paying hourly workers monthly bonuses and they’re not all bad by a long shot. But lurking in the background like a homeless grim reaper is the fact that monthly bonuses are way, way easier to cut and cut quickly than most other expenses. Lay-offs cost money, weaken morale, and don’t look good for the company’s public image. The latter is why big publicly traded companies might want to time layoffs to coincide with a good earnings report. They’re sending a message to shareholders: nothing wrong with our balance sheet, just trimming some fat.

Slashing benefits is another golden oldie to improve earnings. Of course benefit cuts must be implemented at the beginning of the year, they have a unweildy tendancy to affect everyone not just the poors, and they must be planned for with the various third parties involved in advance. But a monthly bonus for the poorest paid riffraff can be slowly reduced on a secret schedule, or quickly done away with in a pinch, right up until the day the comptroller puts in the direct deposit transfers. Before you say not at my company, I would wager your company has a clause in their contract with you that they can do exactly that.

Performance bonuses, let’s call em perfs, are also conveniently flexible as far the requirements to qualify to get them in the first place. That can be as convoluted and obscure as the company wants to make it. Oh ‘Sally, shucks, we wanted to pay you that extra $900 you earned fair and square this month, but gosh-darnit you scored a 78 one of your QA reviews last week and as you know, that’s the cut off for getting a bonus this month...’ Other cut-offs may be attendance–"Uh darnit Sally! That time you took off to get the masectomy just edges you out and to do anything other than rigidly enforcing the cut would be unfair to your fellow employees". Basically anything senior management wants on a whim, they don’t have to be fair about it and they don’t have to even explain themselves to you, the Dept of Labor, or anyone else absent a subpeona–which they will fight like demons to dismiss.

In the fictional scenario that kicked off this essay, Clark Griswold was planning on putting in a pool with his Christmas bonus. That would be nice, but we’re talking survival here, these bonuses are in the hundreds of dollars a month range, not tens of thousands. These workers are making maybe $10/hr to $20/hr or so. They are counting on their monthly bonus to pay for their groceries, rent and utilities, because they sure don’t own a house on that pay, much less one with a pool. So it may be called a bonus, or a perk, or Elon’s happy fun time.

But to answer Clark’s implicit question, yeap, it’s really just pay, and that particular kind of pay for those particular kinds of workers feels like is going down pretty much across the board. But that’s another attractive feature of the perf-bonus: they’re obscure and opaque, hard to track from month to month and year to year. So no one really knows what sort of sheninigans are trending or about to be unleashed in the privileged halls of power this very Labor Day weekend. But I have a solution to the whole thing: Why not just pay a fair living wage in the first place? And, if that simple fix still evades some CEOs, just do away with this perf bullshit altogether, and maybe do away with some CEOs in the bargain. I imagine that would fund some perfs for quite a while.