What is a performance bonus?

A performance bonus is a form of compensation granted to employees beyond their base salary for achieving specific goals or targets. Typically tied to individual achievements, these bonuses reflect exceptional performance over a specified period, whether monthly, quarterly, or annually.

What is a bonus in the workplace?

In workplace settings, a bonus is a type of additional compensation an employer gives to an employee that complements their base pay or salary. A company may use bonuses to reward achievements, to show gratitude to employees who meet longevity milestones, or to entice not-yet employees to join a company's ranks.

How does a company give a bonus?

Companies can distribute bonuses to its existing shareholders through a bonus issue, which is an offer of free additional shares of the company's stock. A bonus is a financial compensation that is above and beyond the normal payment expectations of its recipient. Bonuses may be awarded by a company as an incentive or to reward good performance.