Retention Bonus
Overview
Retention Bonus — Business Overview
Retention Bonus is a business document in Dafater used to plan, approve, and manage special bonus payments offered to employees as an incentive to remain with the organization for a defined period. It helps businesses reduce employee turnover by formally committing to a future reward tied to continued service or achievement of specific conditions.
Purpose in Business Operations
The Retention Bonus document is used to:
- Encourage key employees to stay with the company during critical periods
- Formalize retention agreements in a clear and traceable way
- Ensure retention payments are planned, approved, and paid correctly
- Align employee incentives with long-term business goals
It acts as a structured record of the company’s promise to pay a bonus if retention conditions are met.
Prerequisites and Setup Requirements
Before using Retention Bonus, the following should be in place:
- Employees must be properly set up in Dafater
- Payroll cycles and salary structures should be defined
- Clear company policies on retention bonuses (eligibility, duration, payment timing)
- Approval authority and budget ownership should be established
Having these elements ready ensures the retention bonus is managed fairly and consistently.
Typical Workflow and Business Process Fit
Identification of Need
Management identifies employees or roles critical to business continuity or growth.Creation of Retention Bonus
A Retention Bonus record is created, specifying the employee, bonus amount, and retention period.Review and Approval
The document is reviewed by HR and management to ensure alignment with policy and budget.Retention Period Monitoring
The employee continues service during the agreed period.Bonus Payment
Once conditions are fulfilled, the retention bonus is paid through the payroll process.
This workflow ensures transparency, accountability, and proper financial planning.
Key Business Scenarios Where Retention Bonus Is Essential
- Retaining high-performing or high-potential employees
- Preventing attrition during mergers, expansions, or restructuring
- Securing talent for long-term projects or critical deliveries
- Retaining employees in competitive job markets
- Encouraging continuity in leadership or specialized roles
In these cases, Retention Bonus becomes a strategic tool rather than just a payroll entry.
Important Considerations for Users
- Ensure retention conditions are clearly communicated to the employee
- Align bonus amounts with business impact and market standards
- Track timelines carefully to avoid missed or early payments
- Maintain fairness and consistency across departments
- Document approvals properly to avoid disputes later
Used correctly, Retention Bonus helps Dafater users strengthen workforce stability while maintaining financial and operational control.
If you would like, I can also explain how Retention Bonus interacts with payroll cycles or employee agreements from a business perspective.
Basic Information
- Module: Payroll
- Document Type: Other
Fields
| Field Name | Label | Type | Required | Options | Description |
|---|---|---|---|---|---|
| employee | Employee | Link | ✓ | Employee | Employee receiving retention bonus in Dafater |
| employee_name | Employee Name | Data | - | Full name of the selected employee | |
| department | Department | Link | Department | Department where the employee is currently assigned | |
| company | Company | Link | ✓ | Company | Company entity providing the retention bonus |
| dateofjoining | Date of Joining | Data | - | Employee's original joining date with the company | |
| salary_component | Salary Component | Link | ✓ | Salary Component | Salary component used to process retention bonus |
| bonus_amount | Bonus Amount | Currency | ✓ | currency | Approved retention bonus amount payable to employee |
| bonuspaymentdate | Bonus Payment Date | Date | ✓ | - | Scheduled date for retention bonus payment |
| currency | Currency | Link | ✓ | Currency | Currency in which retention bonus is paid |
| amended_from | Amended From | Link | Retention Bonus | Previous retention bonus record amended in Dafater |
Permissions
| Role | Read | Write | Create | Delete | Submit | Cancel |
|---|---|---|---|---|---|---|
| Employee | ✓ | |||||
| System Manager | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ |
| HR User | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ |
| HR Manager | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ |
Related DocTypes
| DocType | Relationship | Module |
|---|---|---|
| Company | Links to | Setup |
| Currency | Links to | Geo |
| Department | Links to | Setup |
| Employee | Links to | Setup |
| Retention Bonus | Links to | Payroll |
| Salary Component | Links to | Payroll |