I recently started a role at a small hedge fund. My base salary is $150k and this is explicitly written in the offer letter. My target bonus, as per a phone call with my portfolio manager, is 100%, which would bring me up to $300k in the best case scenario. I know bonuses are discretionary but I expected the target of 100% to be written in the offer letter somewhere. Can I ask for it to be written there? Also, there’s no mention of a stub bonus for January given that I start mid-year. I should bring this up too, right? TC: 300k
Definitely get it in writing...
Hedge Funds will never write a target bonus in an offer letter. It’s based on too many inputs and will lock them in
Interesting... didn’t know that. I’m used to a target being written in tech, even if it’s not given out. I’ll still ask about the stub bonus- I want to know if I could receive something in 2021 or if I need to wait till 2022 for the first payout.
That’s not true for all types of finance firms. A friend at Jane Street told me first and second year targets were written in their contracts. Maybe your rule isn’t as ironclad as you think?
Bonuses are bonuses, so you can't really expect them to contractually give you a number
I got my CS bonus written into my contract for year 1
Would imagine that even if you do get some “target” bonus in writing, there will be some kind of clause (or Multitude of them) that basically makes the part about the bonus not even worth having in writing
I fully expect a clause that says it is discretionary. But there’s a comfort to having the number on an offer letter. Additionally, it helps (marginally) with loan applications.
Yeah, I would get it in writing. I got all of my bonus expectations written in writing too, as a range.
I’m getting mixed feedback from the folks here. Some people say “get it in writing”. Others say: “what’s the point of having it written if it’s discretionary?”. I guess there’s no risk in asking and, if they say no to writing it down, at least I’ve asked... Realistically, I’m not turning it down now.
Yeah I agree. At least a bonus range gives you a minimum, even if it is discretionary. Like I said, it’s always been written out so that we can at least have some expectations around full compensation.
Some firms give ranges and others write it in contract. This is pretty normal and I wouldn’t fret about it
Yoe? Why change from fb to a hedge fund?
6 YoE. Higher immediate compensation and higher compensation ceiling.
You were e4 at fb?
They will never put it in writing
I worked at a hedge fund and the bonus for the first year guaranteed (albeit pro-rated) in the offer
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Maybe I am wrong, but isn’t it tad late now that you are already working there? You have already signed the contract without bonus stated on it.
I haven’t signed the contract yet but I have already started working there a couple days. Yeah, I can see how that’s a bit weird... but I had interned there before so it’s not that unusual. Basically, I’ve committed verbally and by doing work for them but I haven’t signed anything yet.
I see. I would definitely ask them to put it in writing and say “I would feel more comfortable if bonus was also stated in the offer as it is a large part of my compensation. It would clear up uncertainty.” After all, they are in finance and hopefully will understand your concern about uncertainty. :)