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Old 01.05.2020, 17:28
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Retention offer to handle company closure

Unfortunately, the company I work for (a US subsidiary) will be closed.
25 people will be terminated effective 31.5. 5 people (including me) will be tasked to closed down the business, so technically employed but essentially fired. To encourage me to stay-on, they offered a retention bonus (half my annual salary) to be paid out on 1.5.2022. If I voluntarily resign before that, I won't get the bonus. If they "fire" me a 2nd time , the bonus gets effected immediately. Information came in only yesterday so there is a lot of unknowns. 2022 is 2-years away, and honestly I can't imagine needing that long time to wind down what we were doing. I could well end up doing nothing much, or they re-assign/relocate me, or the business climate improves, who knows. Compared to my colleagues, I am obviously in a better position as at least I'm able to plan my exit-strategy with more time. Right now, frustration and bitterness boils in me but I'll get a hold of this. With a family to take care, I need to be practical, calm, and let go of the ego. I haven't signed the retention offer. I'm coming here to gather the collective EF wisdom, especially from those who've been in this situation before. This is my first time getting "fired" but we all have our firsts. Should I be asking for more, if yes, in what form? I don't want to cut-off the hand that feeds me but I also don't want to short-change myself. I am not forbidden to look for other opportunities, so that I'll surely do. Thanks all!
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Old 01.05.2020, 17:51
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Re: Retention offer to handle company closure

I would take it. It gives you stability for the next 2 years with a nice bonus on top.
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Old 01.05.2020, 17:58
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Re: Retention offer to handle company closure

I would ask for two things;

1. More money,
2. An earlier latest pay out date. Something like ‘on completion of xyz milestone, but not later than ddmmyyyy. (or 50% at milestone x and 50% on completion, but not later than ddmmyyyy)
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Old 01.05.2020, 18:31
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Re: Retention offer to handle company closure

So your options are:

- Get fired next month, nothing extra.
- Work for two yrs and get 6 months extra payment.
- Work for anything between now and 2 yrs while getting fired for normal payment + six months extra
- Work for anything between now and 2 yrs while resigning yourself for normal payment.

Sounds like a no-brainer to me.

Also if RAV hears of this offer and finds out you refused it, you'll not be getting anything from them.
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Old 01.05.2020, 18:33
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Re: Retention offer to handle company closure

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I would take it. It gives you stability for the next 2 years with a nice bonus on top.
Yes, I'll most likely take it, just wanted to ask advise if it can be improved...
There is no guarantee of 2 years employment, but yes the bonus is nice.
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Old 01.05.2020, 18:37
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Re: Retention offer to handle company closure

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I would ask for two things;

1. More money,
2. An earlier latest pay out date. Something like ‘on completion of xyz milestone, but not later than ddmmyyyy. (or 50% at milestone x and 50% on completion, but not later than ddmmyyyy)

1. In what form? Increase the bonus or increase monthly salary? Which one is more palatable? A higher monthly will improve my RAV benefits, so that is something.


2. Was thinking of the same but simpler, half in 2021 and remaining half in 2022. Since its all gray at the moment, I'm not able to think of it in terms of milestone
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Old 01.05.2020, 18:46
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Re: Retention offer to handle company closure

I do this for a living, so here are my two cents:

1) You have a job for 2 more years beyond end of May and on top of that, a bonus of 1/2 salary if you stay. Sounds pretty good to me. approach the future professionally.

2) being asked to stay looks good on your CV when you do start interviewing. Very easy and understandable discussion when asked "why are you looking?'

3) Stay bonus are pretty common. What is odd is why it takes 2 years to wind down the operation? Any sense to this yet?

4) You will want to make sure that it is spelled out that if you are released before the 2022 date for anything other than cause (i.e. due to an earlier than expected closure, additional downsizing, etc) you will still receive the bonus. I think you mentioned this, but this is really important.

5) Speaking of cause, you will want to understand what will be expected of you in the next 2 years. Are the 5 of you expected to take on some (or most) of the workload of the other 25? What does the wind down look like and what financial milestones are budgeted? What does success look like? Will the next two years be a grind, or will it allow you to do and see things within the business that you normally would not get to learn/do?

6) Given what is presumed to be the financial insecurity of the company, you may wish to understand what the severance package will look like if released early and if severance is offered on top of the bonus. It is a valid question and should not offend your management. You will need to know this anyway as you look for another job and balance the new offer against potential loss of bonus/severance.

7) if you don't take the offer, do you get severance now?

8) kind of early, but if they can not offer a follow on role, will they make allowances in the last 6 months for job hunting (extra days off, etc.)

9) Asking for more money now as suggested? foolish. Management is in slash and burn mode. guy #6, who just lost his job, may be very happy to now stay for another 2 years and take your slot.

Good luck.
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Old 01.05.2020, 18:46
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Re: Retention offer to handle company closure

Quote:
So your options are:

- Get fired next month, nothing extra.
- Work for two yrs and get 6 months extra payment.
- Work for anything between now and 2 yrs while getting fired for normal payment + six months extra
- Work for anything between now and 2 yrs while resigning yourself for normal payment.

Sounds like a no-brainer to me.

Also if RAV hears of this offer and finds out you refused it, you'll not be getting anything from them.

Agree its a no-brainer that I should accept the offer... just looking at options to improve it.
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Old 01.05.2020, 19:04
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Re: Retention offer to handle company closure

What I was thinking VFR on top. Why two years to close a company down?
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Old 01.05.2020, 19:06
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Re: Retention offer to handle company closure

VFR, thanks for the feedback.

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I do this for a living, so here are my two cents:

1) You have a job for 2 more years beyond end of May and on top of that, a bonus of 1/2 salary if you stay. Sounds pretty good to me. approach the future professionally.
As I understand, there is no guarantee of of 2 years employment. My current contract will run as before and just the bonus added.

2) being asked to stay looks good on your CV when you do start interviewing. Very easy and understandable discussion when asked "why are you looking?'
I agree.


3) Stay bonus are pretty common. What is odd is why it takes 2 years to wind down the operation? Any sense to this yet?

What is the usual range of stay bonuses?
I myself find the 2 years odd, its too long to wind down. Maybe its some customer support contract I'm not aware of. I hope to find out more next week.


4) You will want to make sure that it is spelled out that if you are released before the 2022 date for anything other than cause (i.e. due to an earlier than expected closure, additional downsizing, etc) you will still receive the bonus. I think you mentioned this, but this is really important.
This is spelled out. I won't get the bonus if I resign voluntary or fired for "cause".


5) Speaking of cause, you will want to understand what will be expected of you in the next 2 years. Are the 5 of you expected to take on some (or most) of the workload of the other 25? What does the wind down look like and what financial milestones are budgeted? What does success look like? Will the next two years be a grind, or will it allow you to do and see things within the business that you normally would not get to learn/do?
All good points and questions, thanks a lot! I'm as blind as you, so I'll bring it up and ask as soon as reasonable. I'll talk to the other 4 as I feel it is to our advantage if we ask "more" collectively.


6) Given what is presumed to be the financial insecurity of the company, you may wish to understand what the severance package will look like if released early and if severance is offered on top of the bonus. It is a valid question and should not offend your management. You will need to know this anyway as you look for another job and balance the new offer against potential loss of bonus/severance.
The mother-ship AFAIK is still relatively secure. There is no severance package attached to my normal employment contract, just the typical 3 month notice. At this point, this retention bonus, I treat it as severance.


7) if you don't take the offer, do you get severance now?
No severance.


8) kind of early, but if they can not offer a follow on role, will they make allowances in the last 6 months for job hunting (extra days off, etc.)
Nothing offered in terms of job hunting, so anything I do will be on my vacation days.


9) Asking for more money now as suggested? foolish. Management is in slash and burn mode. guy #6, who just lost his job, may be very happy to now stay for another 2 years and take your slot.
I agree that it will insensitive to my other 25 colleagues... and that is important for me. I know they are in slash/burn mode but they also don't want to piss-off whatever customer we have now, and this I think will be a significant role I will take. I understand I need to tread carefully, fortunately I have the long weeknd to calm down and think about it.


Good luck.
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Old 01.05.2020, 19:09
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Re: Retention offer to handle company closure

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What I was thinking VFR on top. Why two years to close a company down?
Within the team, I'm one of the few who knows a lot of our legacy and current products out in the field. I'm probably retained to support customer queries and maybe the contract the mother-ship will negotiate with customers is 2 years I hope to know more next week.
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Old 02.05.2020, 17:23
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Re: Retention offer to handle company closure

Is 2022 defined as the fixed bonus payout date, whenever they actually cease operations? You don't want to be e.g. "fired" in Jan 2021 because the wind-up is complete but have to wait to get the bonus until May 2022 (assuming they haven't completely forgotten you in that period). So just make sure the bonus is paid at the time they cease your employment
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Old 02.05.2020, 17:32
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Re: Retention offer to handle company closure

From a headhunters perspective, the fact that you've been offered to stay to help "turn out the lights" is a very, very good thing - average people just don't get that option.

And from your own career development perspective, its actually a very good thing also - its great experience and you'll learn a lot, that hopefully you won't have to ever use again BUT depending on your career level and what your specialist field is, you probably will.

Take heart in the fact that you're trusted enough to do this - it would have been equally easy, arguably cheaper and lower risk for the company to just bring in a contractor to wind things up. Instead, they're relying on your help and expertise, and prepared to stump up cash to keep you around.

Finally, given they're talking about a 2022 completion, I wonder if they actually are hedging their bets for a future revival....?
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Old 02.05.2020, 21:38
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Re: Retention offer to handle company closure

Typical US Wild West company...

More than 10% of people being made redundant triggers special conditions of the Swiss code of obligations where a company is essentially supposed to look after you through what is called a “social program”.

Most decent companies offer severance (Abfindung) but are not obliged by law other than the usual notice period.

I would want to reduce the risk of default on this promise by collectively agreeing with the other 5 to receive this “bonus” partly this year then next year then 01.05.2022. This only works if you negotiate together, otherwise as pointed out previously you have no negotiation power and number #6 will be more than happy to take your spot.
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Old 02.05.2020, 23:32
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Re: Retention offer to handle company closure

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...I would want to reduce the risk of default on this promise by collectively agreeing with the other 5 to receive this “bonus” partly this year then next year then 01.05.2022. This only works if you negotiate together, otherwise as pointed out previously you have no negotiation power and number #6 will be more than happy to take your spot.
It's not clear from OP's post if all 5 remaining employees are being offered the bonus. He seems to have legacy knowledge the others might not have. If the employees already discussed amongst themselves that's one thing but if OP pipes up to complain about getting an extra half year salary as bonus and they haven't heard of such a thing it could be awkward.
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Old 03.05.2020, 10:04
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Is 2022 defined as the fixed bonus payout date, whenever they actually cease operations? You don't want to be e.g. "fired" in Jan 2021 because the wind-up is complete but have to wait to get the bonus until May 2022 (assuming they haven't completely forgotten you in that period). So just make sure the bonus is paid at the time they cease your employment
May 2022 is only the date of my bonus payout. When the Swiss operation actually cease, that is NOT defined. And IMO, I don't think we need 2 years to wind it down. If operations cease on May 2021, and they fire me, then I get the bonus. If they don't fire me, then I have to wait until May 2022 to get the bonus. I have a Swiss contract, so they somehow need to keep that going if they don't fire me. They can either just let me hang around or re-assign me, I don't know.


If the Swiss operation ceases, what happens legally to my Swiss contract? Can it still continue and be enforced? Or, will it be moved to another existing entity, in this case US?

Thanks smiley!


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From a headhunters perspective, the fact that you've been offered to stay to help "turn out the lights" is a very, very good thing - average people just don't get that option.
Thanks for the info... I wasn't really sure how this will be viewed from headhunters perspective.

And from your own career development perspective, its actually a very good thing also - its great experience and you'll learn a lot, that hopefully you won't have to ever use again BUT depending on your career level and what your specialist field is, you probably will.
I'm 40 this year, so still a long way to go with my career. I'm sure I'll learn a lot out of this experience. But as they say, staying here means I'm letting go of another opportunity elsewhere... and this is for me to decide and balance.


Take heart in the fact that you're trusted enough to do this - it would have been equally easy, arguably cheaper and lower risk for the company to just bring in a contractor to wind things up. Instead, they're relying on your help and expertise, and prepared to stump up cash to keep you around.
I agree, it's just difficult to do considering the bitterness we all felt last week when it was announced. Obviously, the main focus is for the 25 who are let go now but I will try to get info in what form the wind down will look like.


Finally, given they're talking about a 2022 completion, I wonder if they actually are hedging their bets for a future revival....?
If there is a revival, I'm not sure though if they'll keep it here in Switzerland. It was well known that we were an expensive location
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It's not clear from OP's post if all 5 remaining employees are being offered the bonus. He seems to have legacy knowledge the others might not have. If the employees already discussed amongst themselves that's one thing but if OP pipes up to complain about getting an extra half year salary as bonus and they haven't heard of such a thing it could be awkward.
Yes, I don't know if the other 4 were offered any bonus. At this point though, the 5 of us are all in this together, so IMO we need to put aside ego and any awkwardness to get the best out of it. So I for sure will not complain to US boss before talking out with the others. I know the other 2, so I can start with that. What I'm almost sure of is: it was only US boss who decided which 5 and he wrote the email with the retention bonus.

Yes, wild-west mentality. US boss was adamant to get the news announced Apr 30 thinking the termination date could start right then and there. But we need to have the "consultation period" which then push the termination to 31 May earliest. I'm sure nothing will change with this consultation but at least get us an earlier warning. A social plan for 60+ was announced. Severance, I don't have this spelled out in my contract, for most others, I think nothng also. I don't know what was offered to the 25 with respect to severance.


The 5 of us need to talk, that I agree. We need to "improve" the retention offer as a group. We all felt sh*t last week, so that will at least get us banding together.

Last edited by 3Wishes; 03.05.2020 at 13:04. Reason: merging consecutive replies
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Old 03.05.2020, 10:36
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Re: Retention offer to handle company closure

If you're confident of securing another gig, and potentially gaining the equivalent of the "shut up shop" retention bonus as part of a salary increase at a new employer....then you'll be in the lucky position of having choices

And seriously, please don't take the situation to heart - its really important that you see the positives rather than continue to feel pissed off. Easier to say than do I appreciate. At this point in your career, you're just lucky to have never had the prospect of your job disappearing....its a situation that is arguably more normal than not within some industries and has been so for many years.

I've met too many people over the years who wind up unconsciously carrying grudges about ex employer companies. That kind of chip on your shoulder will be spotted by any decent recruiter or HR person or savvy business leader from a mile off, and many of them will simply refuse to work with you (although they'll never admit to it).
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Old 03.05.2020, 11:04
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Re: Retention offer to handle company closure

I'm still positive that I can secure another gig. And this retention offers me even more time to improve my choices and decide. If I get the "retention bonus" added on the next gig, then that is even better.

I felt sh*t last week and the gloomy weather didn't help much, we couldn't even go to the pub for some beer... Sun is shining bright today though and I'll go out on my road bike which hasn't failed to give me a smile.

Thanks for the tip for not holding a grudge. My beef is with the US boss which I see 1-2x per year, so I think it will be easy to let this go.



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If you're confident of securing another gig, and potentially gaining the equivalent of the "shut up shop" retention bonus as part of a salary increase at a new employer....then you'll be in the lucky position of having choices

And seriously, please don't take the situation to heart - its really important that you see the positives rather than continue to feel pissed off. Easier to say than do I appreciate. At this point in your career, you're just lucky to have never had the prospect of your job disappearing....its a situation that is arguably more normal than not within some industries and has been so for many years.

I've met too many people over the years who wind up unconsciously carrying grudges about ex employer companies. That kind of chip on your shoulder will be spotted by any decent recruiter or HR person or savvy business leader from a mile off, and many of them will simply refuse to work with you (although they'll never admit to it).
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Old 03.05.2020, 15:51
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Re: Retention offer to handle company closure

Gorgeous weather for riding today, in central Switzerland at least! No "boss" can take that away from you
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Old 21.06.2020, 15:32
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Re: Retention offer to handle company closure

How did this play out? Curious...
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