Should You Accept Retention Bonus?


When it comes to bonuses and salaries, there is a lot to know and understand. Besides the festive and genuine bonuses, there are various other types too. To begin with, a bonus is a payment given as a form of compensation or incentive. It is an amount given other than the regular salary. Some may be regular while some are one-time. Not all companies offer the same bonuses. There is a kind of bonus given to keep you in the company. That’s right, a retention bonus. Let us know “Should You Accept Retention Bonus?”

Should You Accept Retention Bonus?

Should You Accept A Retention Bonus?

When it comes to accepting the kind of bonuses that are not compulsory or festive, you may want to reconsider. While there are many perks with a retention bonus, there are cons attached too. One needs to carefully understand what a retention bonus is and why it is given. Before accepting, there are terms and conditions to adhere to. It is best to check your interests as well as those of the company before accepting a retention bonus.

 What Is A Retention Bonus? 

So, what is a retention bonus? In simple terms, a bonus is given to keep you in the company. When you’re a potential employee, the company doesn’t want to let you go. Therefore, they are ready to give you a bonus that is a request to make your stay. It can also be a form of incentive. One can also say it is a form of reward for staying and doing your job. However, this bonus is not just given to anyone. A few of reasons why it is given are given below:

Why Is It Given?

The basic idea of giving a retention bonus is to keep you with the company. However, there are many reasons why a retention bonus is given other than this. 

To Stay With The Company

Quite often, employees get offers from other companies. Most of these could also be competitors. Letting you go then would only mean a loss for your company. In such cases, the company decides to give a retention bonus along with other incentives. They negotiate this bonus to increase your chances of staying back. 

To Complete A Project 

Employees may want to leave during the process of a project. It could be that they’re heading it or are a part of the team. If you leave in between, it will be troublesome for the company. It may also affect the output of the project depending on how far you’ve come and your contribution. Therefore, companies offer a retention bonus to prolong your period with the company. Their basic aim is that you finish the project and anything assigned to it. This will save them a lot. Usually, an amount is offered and the employee can accept and leave once the project is completed. 

Maintain Quality Of Work And Results 

If you’re a potential employee, the company will not let you go. The same if you’ve worked for a long time and know the whereabouts of the company. When you contribute an impressive service, it affects the company well. To maintain the repute that the company may owe to your efforts, they offer a retention bonus. Employers are constantly looking for the best performance of the company. If your work does that, they will likely make you stay with the help of this bonus.

Short On Staff

When the company is short on staff, a retention bonus may be offered. This could be due to relocation, increase in workload, and so on. The company may require employees and losing out on one may affect them big time. Therefore, to keep you put, a retention bonus may be given. They need as many hands-on projects perhaps, therefore, they will do all that they can to avoid your resignation. 

Use Your Services And Skills For The Best Of The Company 

If you’re working with the company and you’re doing well, why should the company let you go? Companies don’t love to keep firing and hiring. Hiring employees also takes a great deal of effort and caution.  If your company has got you, they will try to keep you. Additionally, the company is already used to your skills and services, therefore, given the choice, they’ll opt to keep you then go through a whole hiring process with no guaranteed results. Retention bonuses come in handy at such times. 

Pros Of Accepting

Here is a mix of pros of accepting retention bonuses for you as well as the company. 

Earn Loyalty

It is a well-known fact that the period you work with a company partially decides your professional loyalty. When you accept a retention bonus and stay back, it not only benefits your company but also you. The increase in your tenure at the company can later be beneficial for future jobs. Professional loyalty is an excellent add-on to your resume. 


When loyalty increases, so does your reliability. Each is directly dependent on the other. The longer you work, the more efficient you are with the company’s target and nature. This allows the company to rely on you for bigger projects and positions. Moreover, you get to add reliability to your resume. In many cases, you may find that as an added quality on your recommendation letters as well! 


Maintaining consistency in your job again shows well on your profile. Not just that, you get used to the work you’re doing as well. Moreover, accepting a retention bonus and staying back allows you to continue your comfortable way of working to yield better results. Being consistent also increases your productivity overall. You can count that as another pro here. This also looks good on you and the company. It benefits both ways to accept a retention bonus when this point is considered. 


Often if your profile shows that you have had a frequent shift on jobs, they get shaky on hiring you. Accepting a retention bonus and working for a longer period works in your favor when it comes to experience. Other than this, it’s hard to get experience when you’re jumping jobs. It’s ideally better to stay for a good period in a company and learn well before you move ahead. 

Cons Of Accepting

There are cons to everything. Retention bonuses have their own too:

One-Time Payment 

Most retention bonuses offer one-time payments only. This means that after you receive that payment once, you’re back to the regular style of work. Moreover, the contacts made through retention bonuses are usually for a good period. For instance, if you’re offered 15% more of your salary as a retention bonus, it will be just once. However, the contract may be to work with the company for 3 months more. 

Stuck With Contract 

Once you accept a retention payment, you’re stuck till the contract ends. No matter what your reason, you can’t leave or resign. Therefore, it’s best to consider why you’re leaving a job before accepting a retention bonus. Also, remember to look at the contract as that will help you decide better. There’s no going back after accepting the bonus and signing the contract. 

Small Payments 

Retention bonuses are decided based on the reason for leaving. They may also be measured by the skills you have and how important you are to the company. However, the bonuses are not as high as other bonuses. They may be a small amount up to 25% or 30% of your salary maximum. So in case you have no better offer, it’s not advisable to accept a retention bonus with a low amount. 

Rejection Of Other Offers

This is a big one. You can’t accept other offers till you complete your contract. So even if you get any good and worthwhile offers, they’re going to have to wait or go. This is a negative point because a retention bonus is not always given. Therefore, it’s not always anticipated either. Many begin looking for other jobs before leaving the present one and if they find a good offer, they have to let it go if they accept the bonus. 


A retention bonus has its pros and cons. It isn’t necessarily always bad. One must consider their reasons for leaving as well as the opportunities available with them. In cases where you don’t have a backup, it’s better to accept the bonus. With all the information in place, make the right choice for yourself! 

  • Does every company provide a retention bonus? 

No. Only certain companies provide retention bonuses. Moreover, not all employees may get one. There are various reasons that employers consider before offering a retention bonus. Therefore, it isn’t an assured bonus.

  • Are retention bonuses one-time or regular?

Most retention bonuses are one-time. It is given in accordance with the company policy and contract. It may also be given in installments during the contact period. There aren’t regular retention bonuses as the bonus is given for staying with the company only for a specified period.

Should You Accept Retention Bonus?

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