Bonuses given to state employees this year reached a record high, according to a Forum News Service report last week.
State agencies paid out more than $625,000 through a performance bonus program for the fiscal year that ended last month. That’s $20,000 more than was paid out last year.
State Sen. Ray Holmberg, R-Grand Forks, a longtime minder of the state’s checkbook as a member of the Senate Appropriations Committee, told Forum News Service that the record payouts don’t look right as the coronavirus pandemic squeezes state government.
"With all of these things going on, and with all the turmoil going on in the economy and in government and in society, these bonuses just don't have a nice look about them," he said.
Before any rage builds over the state’s payout during the pandemic, it’s important to remember these were included in the last budget. Once the state agreed to have the bonus program – and once it was approved in the most recent budget – it must follow through on its commitment.
But going forward? It’s time for the state to reconsider the bonus program, since it’s a subjective process and since the ones who are footing the bill – North Dakota’s taxpayers – really have no say who gets a bonus and who doesn’t.
And most concerning, it’s a program that even some in state government have shunned out of concerns that it is unfair to employees.
As noted in the recent FNS report, the Department of Transportation awarded 97 bonuses this year, Workforce Safety and Insurance awarded 83 and the Office of Management and Budget awarded 48. Yet some agencies choose not to participate.
"We want the salary to reflect that (employees) are important to us. That's just the way to do it," said John Bjornson, head of the state's Legislative Council, whose office does not use the program.
Importantly, he said, employees who do not receive bonuses are left to wonder: “What have they done that I haven’t done to deserve this?”
A decades-old report in Harvard Business Review concluded that bonuses may create quick or temporary successes, but they “do not create an enduring commitment to any value or action.” Anecdotally, we know some businesses have rethought bonus programs and instead work on better management practices to bring desired business results.
Some specific jobs still work best with performance bonuses. Those involved in sales, for instance, will likely always be incentivized by bonuses and performance pay since they’re the hunter/gatherers of a company. It makes sense for revenue-generators to be compensated to ensure a company’s revenue line in the general ledger is healthy.
It’s unclear what tasks were completed by the state employees who, collectively, were rewarded $625,000 for work over the past fiscal year, but it seems unlikely they all were tasked with some sort of revenue generation for the state.
For those who are not, they simply should be paid – adequately and fairly – for doing the tasks they were hired to do in the first place.