If I am not performing to expectations, fire me or renegotiate my salary. There are a great many ways to tune my compensation to my actual determined worth.
A discretionary bonus in this case is simply "you should take a below-market salary until we're convinced you're the real deal, and then maybe you will get the salary difference back". I'm not convinced anyone who isn't desperate will take this deal.
And having experienced the discretionary bonuses at two very large and well-known software companies, I am absolutely, completely, vehemently disinclined to ever enter into such an arrangement again.
For discretionary bonuses to make even the most remote amount of sense, it needs to offer the employee an upside for taking on the uncertainty.
"If I am not performing to expectations, fire me or renegotiate my salary."
Both of these are high overhead, which means harder to tune. Depending on circumstance, that may work to the advantage of the employer or employee, or to the advantage or disadvantage of both.
In principle it needn't require desperation, just confidence that your market salary should be above what you can demonstrate it should be during the interview process.
Again, I'm not speaking to actual practicality - I know in a limited fashion how it has and hasn't worked for me, where discretionary bonuses have occasionally been present but have generally not been a large part of my compensation; I don't have any particular insight into their function / misfunction broadly.
"For discretionary bonuses to make even the most remote amount of sense, it needs to offer the employee an upside for taking on the uncertainty."
Obviously.
Anyone saying "Base + max bonus gives the compensation you expect" is trying to take advantage. It should be "base + expected bonus is marginally higher than the fixed rate you would deserve if you are as good as you think".
Many companies give you a market rate and a bonus (sign on / stock RSU/ cash bonus etc) on top of it to incentivize extra work / ownership.
My case: my base salary is pretty competitive considering the market/location. I also get a stock award on top of that based on my future potential / current work etc. For me, the stock component has been a reasonable contributor to the final net take home.
Essentially: you work hard, you can potentially make 2x-3x your base and this multiplier only goes up as you go up levels.
I am not against discretionary bonuses like the above (obviously :). Come for the base, toil for the bonus.
This is definitely how it should be, the rule not the exception. It tends to seem like the exception in the places I've been exposed to. Its likely my choice centered around this area of the Atlanta suburbs that reinforces my perception.
If I am not performing to expectations, fire me or renegotiate my salary. There are a great many ways to tune my compensation to my actual determined worth.
A discretionary bonus in this case is simply "you should take a below-market salary until we're convinced you're the real deal, and then maybe you will get the salary difference back". I'm not convinced anyone who isn't desperate will take this deal.
And having experienced the discretionary bonuses at two very large and well-known software companies, I am absolutely, completely, vehemently disinclined to ever enter into such an arrangement again.
For discretionary bonuses to make even the most remote amount of sense, it needs to offer the employee an upside for taking on the uncertainty.