Question

Is it ethical for companies to offer incentive bonuses only to top managers? Why or why not? What are the pros and cons of making such bonuses available to all employees who meet performance criteria?

Answer 1

It is not ethical for companies to offer incentives only to top managers, and even low-level employee should also get incentives based on their performance, In the company point of view, long-term retainment of the top employees persist so they provide a good incentive for them they are less concerned about the low-level employees.

Pros of giving bonuses to all employees.

1.Motivation: By providing incentives the employees get motivated and try to work hard for their future assignments.

2.Identification: By providing incentive the employee is paid for their hard work, identified amongst the other employees.

3.Healthy competition: To improve Healthy competition they give incentives for the employee.

Cons:

1 Unrealistic Expectations: if the profits are high in this year for an organization give a good bonus, but for the next year there is a decline in the profit the company cannot give the bonus for that year employees get disappointed for not getting bonuses.

2. Taxations on Bonus: bonus pay is often subject to 25% withholding.

3.EMployee competition: This can lead to inefficiencies, such as certain employees taking on too much work while others have too little, or employees performing tasks outside of their areas of expertise.