A signing bonus is important to job seekers and can influence their decision-making when it comes to job searching, but what actually is the bonus and why does it boost applications?
Well, a signing (or sign-on) bonus is a one-time incentive paid to a new employee upon joining their new company. It makes switching career or position that little bit more rewarding, so advertise it if you can offer one and consider one if you don’t.
Why, you ask?
Perhaps the candidate you are hoping to recruit is expecting a higher salary but it’s just outside your company’s range or budget… you might be able to offer a signing bonus to make up the difference for the first year.
Or maybe you’re competing with another company for the same candidate? Offering a sign-on bonus might be the missing X-factor that can seal the deal.
It could be that you want to recruit someone who currently has better benefits (maybe it’s flexible hours or gym membership) – if you can’t offer the exact same and your candidate is hesitant, you could try a signing bonus to bridge the gap.
Maybe it’s just that, as a company, you want to minimise salary expenses; no matter who the candidate is if you were to give a 5% pay rise after one year this would be 5% on top of their base pay only, not the base + bonus (ultimately making you a saving).
So, next time, it might be a good idea to weigh up whether a sign-on bonus would work better for your recruitment situation, because I bet you’ll probably find that it does!