Been offered a job - unclear of bonus terms - any advice?

[CrystalDeCanter]

Hi there

I've been offered a job which pays a basic salary which is less that I currently earn.

It does however have a substantial bonus element to the salary, I have been given the offer with this wording - I'm being a bit thick so can someone explain it to me . . .?

In addition to the salary of $XX there will be a Bonus/Incentive Structure paid after the end of 2014 financial year. The threshold for the bonus payment (ie the level of net income above which bonus is payable) is set at $YY, Note this is after deduction of all costs - internal and external (excluding your salary). A bonus will be paid equal to 50% of all net income above the threshold. This applies to all work delivered and invoiced from 1/7/13 to 30/6/14.

How does this sound to you? They have given a gross income budget and the figures they suggest look promising - but its a risk innit?

WWYD? Any questions I should be asking?

Thanks

I would want to know what "all costs" includes...

Yes, that's a bit worrying. It could mean anything . . . I'll check.

Is the threshold a company based one , your personal earnings or both ? What is the target figure net of ?

Lizs, qood q's will talk to them today to clarify - also I need to get them to up the basic as it's not enough to support everything - mortgage, bills etc.

Feeling a bit conflicted about it all - great job - just up my street etc but a big risk for family finances if the bonus doesn't arrive.

Remember you won't get the bonus until July 2014 - can you manage day to day until then?

Hmm! So is this saying that from the income you generate, they deduct "costs" (except your salary), and if what's left is over £YY, you get a bonus equivalent to the 50% of this sum?

For starters ask them to clarify what these "costs" represent. I've never heard of "costs" being deducted from someone's bonus - this almost sounds like they are deducting the cost of employing you from your bonus?

I could understand if they had merely said "your bonus will be 50% of your net income over £YY", because that would be basically mean 50% of the profits you generate, as opposed to the revenues you generate, but then that would include your salary in the gross, as this, surely, also represents a cost...