At least two out of five companies will pay an annual bonus this year, despite the tough economic environment, a survey by a leading human resources consultancy firm has established.

BY BUSINESS REPORTER

This comes as government announced that it would stagger bonus payments for the civil service despite low revenue inflows to Treasury coffers.

A survey by Industrial Psychology Consultants (IPC) showed that 44,93% of the respondents said they would be paying a bonus in 2015.

“36,23% said they will not be paying. 18,84% were not sure. Our findings this year indicate that the number of companies that are likely to pay a bonus may have decreased by 4,53% when compared to 2014 (49,46%),” the survey noted.

“The percentage of participants who are not sure if they are paying a bonus has decreased by 4,82% compared to 2014 (23,66%).”

Of the companies that will pay bonuses, 35% said it was a guaranteed bonus, while 32% said it was performance-related payment.

“The trend of paying bonuses that are not performance-related seems to be continuing. This could be a historical anomaly resulting from contractual obligations that give employees the right to a guaranteed 13th cheque, regardless of the performance of the company,” IPC said.

It said a number of companies are still paying bonuses that are not performance-related, attributing this to either the sector’s collective bargaining agreements or contractual obligations.

IPC said it was not sustainable to give bonuses not linked to performance, warning that a number of companies would struggle to pay the bonuses due to the economic performance.

“We believe that paying a performance bonus is more sustainable. There must be clear rules with regard to when the company can declare a bonus,” IPC said.

It said the guaranteed bonus payment system “perpetuates a culture of entitlement where employees simply expect a bonus without delivering results that help sustain the business”.

IPC warned of more staff rationalisation exercises in 2016 as employers struggle to contain costs.

“In the process of rationalising staff, employees need to be aware that rationalising staff without implementing strategies to increase revenue will not be sustainable,” IPC said.

The survey had 69 respondents drawn from more than 15 sectors.

The headcount from the participating organisations ranged from a minimum of 4 employees to a maximum of 5 000+ employees. IPC said the respondents were human resources professionals (human resources officer to as high as human resources director).

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