Although the economic environment remains strained, the latest Jack Hammer Corporate Survey reveals that companies are sticking with their bonus culture - and their obligations - even though company performance may be tepid. Asked whether their staff would be receiving a 13th cheque or bonus this year, 100% of the companies polled answered in the affirmative.
The survey was conducted during October this year among South Africa's top corporate employers by executive search firm Jack Hammer Executive Headhunters. Entities polled were from the banking, investment banking, wealth management and FMCG sectors, as well as government, manufacturing and insurance.
All respondents indicated that their junior and mid-level staff would be receiving end of year sweeteners, says Debbie Goodman-Bhyat, MD of Jack Hammer. "But what needs to be kept in mind is that many companies are contractually obliged to disburse 13th cheques regardless of performance.
"I would not say that the response indicates an easing of the extreme belt-tightening experienced over the past few years. Rather, companies have recognised that to withhold the expected 13th cheque because markets are tough, becomes a big issue with staff morale and ultimately productivity and staff retention."
What is clear is that in all sectors, from investment banking to manufacturing, performance or profit share bonuses would be paid out to senior staff where individual and company performance targets were met, but that the expected sums are set to be smaller than they would have been prior to the global financial crisis.
"Since then, bonus sums have consistently remained weak. The bonus structures, formulae and potential have not changed, but the amounts disbursed have in almost no instances reverted to pre-2008 highs," says Goodman-Bhyat.
