Most construction bonus plans pay only people who are still employed on the payment date, so resigning before a year-end bonus is paid usually forfeits it. Read the plan, work out what waiting costs you, and ask the new employer to make the forfeited amount whole with a signing bonus. Many will, if you can document it.
It is October. The recruiter’s client wants you in November, and your year-end bonus pays in March. You have earned it, in the sense that the jobs you ran made the money. You have not earned it in the sense that matters, because page two of the plan says a participant must be employed on the date of payment. Between now and March sit five months of work for a firm you have already decided to leave. Contractors know what that clause does. It is why the bonus is paid in March and not in December.
Do you lose your year-end bonus if you resign?
Usually, if you leave before the payment date. Most contractor bonus plans are discretionary or require employment on the day of payment, and under those terms a resignation in the gap forfeits the bonus. A written plan that defines the bonus as earned by a formula can be treated differently under some state wage laws.
Three kinds of plan produce three answers:
- Discretionary. The owner decides each year. You have no claim until it is paid.
- Formula with an employment condition. A stated percentage of project or company profit, payable only to people employed on the payment date. This is the most common wording.
- Formula, earned on completion. A bonus tied to a project milestone, with no employment condition. In some states this is wages once the milestone is met.
The distinction matters because wage law is set by the states, and they differ on when a bonus becomes wages that must be paid at separation. The Department of Labor lists the state contacts for the offices that enforce those laws. Read your plan document before you assume anything, and if the amount is large, pay an employment attorney for an hour.
Know what the payment is worth after tax too. Employers commonly withhold federal income tax on a bonus at a flat 22 percent, the supplemental wage rate described in the IRS employer guide, before state tax and payroll taxes. A $30,000 bonus is a smaller deposit than it sounds. Before the next offer, learn to read the new firm’s bonus plan for the same employed-on-payment-date clause.
Once you know that the bonus is at risk, the question is whether it is worth the five months.
How much is the year-end bonus worth against waiting?
Compare the bonus with what you lose by staying: the extra pay you would have earned in the new job, and the chance that the seat is gone by March. Waiting usually wins on arithmetic alone when the bonus is large. It often loses once the risk to the new job is counted.
Work the example. Your bonus is expected to be $30,000. The new job pays $20,000 a year more, which is about $8,000 over the five months you would wait. Leaving now therefore costs you $30,000 and gains you $8,000, a net loss of $22,000. A signing bonus of $22,000 makes you even.
The sum leaves out three things:
- The seat may not wait. A contractor with a project starting in January will hire someone else.
- The bonus is an estimate. A discretionary bonus for someone the owner suspects is leaving has a way of shrinking.
- Five months is a long time to be half-present. Your work, your team and your references all notice.
The second item deserves weight. If your number depends on the owner’s judgment in February, the expected $30,000 is a forecast. Past payments are the best guide to how reliable it is. The bonus is rarely the only line either: unvested retirement match, deferred pay and a part-used benefits year belong in the same sum, and a hiring firm that has priced the full ledger will expect you to name each one. If the sum says stay, the same budget calendar governs a raise request, which is decided months before the review.
Will a new employer make up a lost year-end bonus?
Often, yes. Covering a forfeited bonus with a signing bonus is one of the most common requests in senior construction hiring, and most contractors would sooner pay it than wait five months. You will need to show what you are giving up, and expect a repayment clause.
How to ask:
- Raise it early. Mention the bonus timing in the first serious conversation, before an offer is drafted.
- Document it. The plan wording and last year’s payment are enough. You do not need to share your employer’s financials, and should not.
- Ask for the specific number. “I would forfeit about $30,000 in March. Can the offer cover that?”
- Expect terms. A signing bonus usually has to be repaid, in full or pro rata, if you leave within one or two years.
- Consider a split. Half on arrival and half at six months is a structure many firms accept.
Our note on negotiating a job offer covers the wider conversation, and the one on incentive compensation shows how contractors design these plans, including the employment condition that created your problem. Get the signing bonus and its repayment terms into the employment agreement or offer letter before you resign.
A later start is the other answer. If the new firm can wait until the week after your bonus pays, nobody has to buy anything out. Be straightforward about the reason: every president in Houston or Charlotte has a March bonus date of their own and understands the request. If the move is about burnout, though, a later start keeps you longer in the seat that caused it.
Timing a move around the bonus calendar
Hiring in construction has a rhythm that follows from all of this.
| Time of year | What happens | What it means for you |
|---|---|---|
| October to December | Candidates hesitate with bonuses pending | Fewer people moving. Firms pay signing bonuses to shift them |
| January to March | Bonuses are paid | Offers get accepted with start dates after payday |
| March to May | Resignations tend to follow payment | More candidates competing for the same seats |
| Summer | Projects are in full swing | Firms hire for urgent gaps and pay for speed |
The pattern creates an opening. A candidate willing to move in the autumn, with the bonus bought out, competes against fewer people than one who waits for spring with everyone else. An autumn offer often comes with a short offer deadline attached, and the bonus buyout is one of the terms to settle before it runs out. The Bureau of Labor Statistics publishes monthly quits and hires for construction in its JOLTS series, for anyone who wants to test the season against the data.
Be careful about resigning the day after the money lands. It is legal and common, and your employer will still draw conclusions. If the plan has a clawback for departures within a set period after payment, that is in the document as well. Resign only once the new offer is in writing and every condition on it has cleared, because a rescinded offer after notice leaves you with neither seat. Give proper notice and a full handover, as our note on resigning mid-project describes.
Selah Talent Partners handles confidential executive search for mandates that cannot be publicly posted, for contractors across the United States. Bonus timing belongs in the first conversation, so a client knows before it makes an offer what it will take to move someone in October. To talk through your own calendar, start at the candidates page.
Read page two of the plan tonight. The clause has been there since the day you signed.
Sources and further reading
- State contacts, US Department of Labor, Wage and Hour Division
- Employer guide, Internal Revenue Service, Publication 15
- JOLTS, Bureau of Labor Statistics, job openings and labor turnover