I have been tasked with re-developing our employee incentive program.
1. Current Lease & Renewal Commission is based on “effective rate x lease term x factor = commission.” Renewal Commission is split between all onsite employees.
a. Our investors have requested the incentive is driven more to the bottom line. I.e., paying New Leases based off Net Move-Ins for the month, etc.
2. Current Year End Bonus plan is based on Net Income. The employees are eligible for up to 5% of their annual salary.
a. Our investors want to implement a plan on a quarterly basis in order to positively impact this throughout the year.
3. Current Competition Quarterly Plan This is geared to Rental Collections, Net Leases and Renewals. The property that has the biggest improvement for the entire quarter is the winner. The rewards vary from1/2 day off, gift certificate to spa, bowling, dinner for two or up to $50 bonus.
a. Our investors want to keep this plan, but want to gear it back towards to the bottom line.
We completed research through reaching out to our District Managers for their prior incentive plans, local apartment association and SHRM.
We presented to our investors an option to our investors that not only give an extra incentive for increasing over prior month performance (5% increase), but also a negative incentive for decreasing prior month performance (2% decrease). Our investors feel that the plan is not “KISS”.
I am reaching to my industry colleagues for advice as it relates to incentives that reward positive cash flow and is KISS. Any advice is appreciated.